Will AVAX Bounce? Whales Are Accumulating Ahead of a Possible Market Turnaround

Avalanche (AVAX) is under pressure right now, with its price going down on the charts over the last few days.

Avalanche (AVAX) has been facing some pressure lately, with its price moving lower in recent days. However, even as the altcoin trades in the red, there are some bullish signals emerging that could indicate a turnaround for the market.

At the time of writing, AVAN was priced at $18.71, after falling by 2.13% in the last 24 hours. Over the past week, it has dropped by nearly 10% as more people started selling.

Here, it’s worth noting that the downtrend is still strong. And, AVAX is likely to struggle to stay above important price levels.

What does whale activity say?

One reason for AVAX’s price decline could be recent developments with the Avalanche Foundation. Earlier this month, three board members stepped down, raising concerns among some about the project’s future.

While the team has stated that everything is progressing as planned with new members being welcomed, investors may still have some worries.

Additionally, broader market trends are also impacting AVAX. Bitcoin (BTC) is currently holding above the $84,000 level. If BTC manages to sustain this price point and continues its upward trajectory, it could help spur a recovery in AVAX and other cryptocurrencies.

Source: IntoTheBlock

However, despite the bearish price action, data from blockchain analytics firm, IntoTheBlock, showed that large investors, known as whales, have been actively accumulating.

In the last 24 hours alone, there were 314 large transactions. And, there was a 7-day high of 353 on 19 March and a 7-day low of 109 on 16 March.

This increasing buying pressure could be a bullish signal as it shows that large investors are still bullish on AVAX even as the price drops.

AVAX’s volume and Open Interest trend

At press time, AVAX’s trading volume was at $213.47M – A 38.92% drop. However, a spike could indicate renewed buying interest.

Meanwhile, Open Interest, which tracks the number of active futures contracts, stood at $341.27 million. However, it has been dropping.

Source: Coinglass

This means fewer traders are now opening new positions, showcasing their cautious approach towards the market.  If OI starts increasing along with the price, it could mean more traders are getting involved, and the trend might take a turn for the better. 

To put it simply, AVAX is at a crossroads right now. While bearish trends are still prevalent, signs of accumulation and key technical indicators suggest a potential rebound. If Bitcoin continues its strong performance and helps AVAX break through its overhead resistance, a recovery could unfold.

However, failure to hold crucial support levels could lead to further price declines.