AVAX Bulls Target $32 Amid Growing Pressure on Short Sellers
Avalanche [AVAX] appears to have shifted towards a bullish trend after a series of declines. The strong performance in recent weeks has led to a significant uptrend, surpassing the key resistance level at $27.
This positive trend could potentially drive AVAX towards the $32 mark in the short term, assuming the current rally maintains its momentum.
The surge in AVAX bullish sentiment may have been fueled by increased short liquidations, particularly at the $27 price threshold.
Analytics from Hyblock Capital revealed a notable uptick in net short positions on Binance between September 23 and 24.
Furthermore, CryptoCrypto witnessed a substantial surge in buying volume on September 24, potentially contributing to AVAX breaking above its resistance level.
Accompanying this move was a resurgence in long positions following a previous decline during the same trading session.
The recent liquidations combined with heightened demand could pave the way for further bullish momentum. Notably, AVAX’s heat maps indicated a surge in liquidations at the $28.20 price point within the last 24 hours.
While the heat map suggested a liquidity sweep at this level, the continuation of strong momentum remains uncertain.
Following this, AVAX bulls have experienced a slight slowdown, resulting in a 2.71% decrease in the past day at the time of writing.
At the current juncture, AVAX is valued at $27.67, indicating a level of uncertainty surrounding its demand dynamics.
However, a broader analysis of its chart pattern reveals a cup and handle formation, suggesting a potential uptrend in the early stages of recovery. If this pattern plays out as anticipated, bullish sentiment could prevail in the coming weeks or months.
On-chain data reaffirms the dominance of bulls, with substantial inflows into large holder addresses this week. Large holder inflows peaked at 4.97 million coins, surpassing outflows which peaked at 3.67 million coins.
While address inflows have decreased to 2.45 million AVAX based on the latest data from September 24, it still surpassed large holder outflows at 1.34 million AVAX on the same day.
This indicates a slowdown in demand, albeit remaining stronger than selling pressure during the period of short liquidations.