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Avalanche is facing Inflationary pressure which might drag the price below the $10 level. On August 26, the AVAX team executed a much-heralded token unlock event, which observed 9.54 Million tokens released in circulation.
However, the bullish Avalanche whales are trying hard to soak up the inflationary pressure and defend the level of $10. The AVAX price has been on a downward spiral, losing all the gains it made in January 2023 and continuing to drop lower and lower.
The daily chart reveals that the crypto has been trapped in a channel pattern and has faced multiple rejections from the upper levels. The price has fallen more than 50% since then and shows no signs of stopping.
The price attempted a recovery from the $10 level and rose higher, but it could not break out of the channel pattern and fell again. The sellers used the price increase as a chance to sell on the rise and short-sell heavily, which caused the price to plunge back and erase the gains.
The short-term outlook for the price prediction states that the price may decline more as the price is under the control of the bears. The $10 is an Important defending zone for the Bulls to stay and dominate in the game. Also, it requires more buying volume to enter the market.
The breakdown of $10 might trigger another sharp downside move and the price may decline to the lower levels.
Also, the volume analysis shows that the volume received is less than the average volume indicating the weakness in the market. The AVAX token has received a $109.02 Million volume in the past 24 hours which is nearly 20.58% less than the past day.
As per the EMA analysis, the AVAX price could not sustain above the 50 and 200 EMA indicating the weakness on the charts. Also, the 50 and 200 EMA may act as a resistance to the price if the price surges higher.
MACD lines have made a bearish crossover. Also, Histogram bars are being formed below the mean line with decreasing height indicating the loss of momentum in the selling pressure.
Avalanche is a blockchain platform that competes with Ethereum. The AVAX price has been dropping since January 2023 and is stuck in a channel pattern. On August 26, the team unlocked 9.54 Million tokens, which increased the inflationary pressure. The bullish whales are trying to defend the $10 level, but the sellers are dominating the market. The price failed to break out of the channel and fell back. The price may decline further if it breaks below $10. It needs more buying volume to reverse the trend.
The views and opinions stated by the author, or any people named in this article, are for informational purposes only and do not establish financial, investment, or other advice. Investing in or trading crypto or stock comes with a risk of financial loss.
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