Avalanche (AVAX) has more than doubled in value since the beginning of October 2023, rising from $9.25 to a high of $24.70.
The current price of AVAX stands at $21, and for now, bulls continue to control the price movement. Avalanche has also witnessed a noticeable increase in staking recently, further affirming that the bullish price action is driven by fundamental network activity. But, potential investors should keep in mind that investing in AVAX at the current price involves a significant degree of unpredictability and substantial risk.
But where is the price of Avalanche (AVAX) going next, and what can we expect from December 2023?
Today, Crypto Lists will discuss AVAX price estimates from a technical and fundamental analysis perspective. Please note that there are also many other factors to consider when entering a position, such as your time horizon, willingness to risk, and how much margin you have if trading with leverage.
Avalanche witnesses increase in staking
Avalanche is a blockchain platform that allows you to build decentralized applications, and it was designed to address some of the limitations and challenges faced by earlier blockchain platforms like Bitcoin and Ethereum, particularly in terms of transaction speed, scalability, and consensus mechanisms. Avalanche can process more than 4,000 transactions per second, and it is one of the fastest smart contracts platforms in the blockchain industry.
The platform supports the creation of custom blockchain networks, known as subnets, which can have their own rules, parameters, and virtual machines. This allows developers to tailor their DApps to specific use cases while still benefiting from Avalanche’s consensus and security features. The popularity of Avalanche is growing, and its flexibility is positioning it as the best option for institutions, enterprises, and governments.
Sitting only behind Solana
Over the past 10 days, AVAX has surged by more than 60%, securing its position as the second most successful mega-cap cryptocurrency in the current month, trailing only Solana (SOL). Delving deeper than the general surge in alternative coins, analysis of on-chain data has unveiled the core factors propelling the continuous upward trend in AVAX’s price. According to crypto analyst Hitesh Malviya, the current surge in AVAX price is being driven by the underlying network activity, as opposed to speculators simply riding the wave of the overall altcoin market rally.
Avalanche burns 100% of its revenue from transaction fees and an increased burn rate during the current “bull” phase is an indication that the price uptrend is currently being driven by organic transactional activity. It is also important to say that Avalanche holders and validators staked more than 36 million AVAX tokens in the first two weeks of November 2023 to either secure the network or participate in specialized ecosystem activities.
A rise in staking amid a rally is typically seen as bullish for several reasons; primarily, staking results in the temporary removal of tokens from circulation. For instance, the 36 million AVAX staked in the period mentioned above is worth $680 million when valued at $19. In a market characterized by strong demand, a substantial decrease in market supply is expected to initiate a price increase. As expected, AVAX’s 70% price surge in the past two weeks has aligned with a 16% uptick in AVAX staking.
Tech company choses Avalanche for profit-sharing digital asset
As upcoming GameFi projects emerge, there’s potential for Avalanche holders and node validators to be encouraged to maintain their token staking. Should demand persist, the AVAX price surge might reach higher levels in the upcoming weeks. Encouraging developments also include the recent announcement by tech company Republic, declaring its aim to democratize private market investment by choosing Avalanche as the platform to launch its profit-sharing digital asset, the Republic Note (R/Note).
The R/Note is a revenue-sharing digital security that is backed by the Republic’s private equity portfolio, which includes over 750 assets. As per Republic’s statement, Avalanche was selected for various significant reasons. Primarily, its scalability and rapid transaction processing guarantee that holders of Republic Note can experience smooth and cost-efficient transactions. Further, Avalanche has formed alliances with well-known brands such as Amazon Web Services and Mastercard, showcasing its technical prowess.
The public listing of the Republic Note is scheduled for December but the pre-sale of Republic Notes has already attracted participation from thousands of individual retail investors, resulting in pre-sales above $30 million. The collaboration between Republic and Avalanche is expected to yield a favorable influence on the AVAX price. Introducing the Republic Note on Avalanche’s platform sets a robust groundwork for extending its accessibility to a worldwide investor base.
Technical analysis for Avalanche (AVAX)
Avalanche (AVAX) has advanced from $10.87 to $24.70 since November 01, 2023, and the current price stands at $21.12. Despite the minor correction, bulls continue to control the price movement and as long the price of AVAX is above $20, this crypto remains in the BUY-ZONE.
Important support & resistance levels for Avalanche (AVAX)
On this chart (the period from May 2023), I marked important support and resistance levels that can help traders understand where the price could move. According to technical analysis, bulls control the price movement of AVAX for now, and if the price advances above $25, the next target could be resistance that stands at $30. The important support level is $20, and if the price breaks this level, it would be a “SELL” signal, and we have the open way to $18. If the price drops below $15, which also represents strong support, the next target could be located around $12.
What speaks for the rise in the Avalanche (AVAX) price
Looking at on-chain metrics, the surge in staking and the growing network engagement due to GameFi adoption stand as essential catalysts propelling the current AVAX price rally. With these indicators continuing their upward trajectory, it positions AVAX’s price favorably for additional gains. At the same time, the growth of Bitcoin, just like the rest of the cryptocurrency market is also an important factor that has a positive influence on the price of AVAX.
What indicates the downfall of Avalanche (AVAX)
The decline of AVAX can be affected by numerous factors such as market sentiment, regulatory changes, technological progress, macroeconomic shifts, and various others. The recent heightened activity among AVAX whales indicates a renewed sense of interest and trust in AVAX. However, it’s crucial for investors to acknowledge the inherent volatility of cryptocurrency markets.
While positive advancements can lead to significant price surges, they also entail potential risks. AVAX is unpredictable and a highly risky investment, and because of this, investors should continue to be very cautious in the case of this cryptocurrency. The important support level for AVAX stands at $20, and if the price falls below this level, the next target could be $18 or even strong support at $15.
What do analysts and experts say?
AVAX is outperforming Bitcoin and the rest of the cryptocurrency market and since the beginning of November 2023, the value of AVAX has increased by more than 80%. According to crypto analyst Hitesh Malviya, the current surge in AVAX price is being driven by the underlying network activity, as opposed to speculators simply riding the wave of the overall altcoin market rally. During the initial fortnight of November 2023, Avalanche holders and validators staked over 36 million AVAX tokens, either to safeguard the network or engage in specialized ecosystem activities.
Looking at on-chain metrics, the surge in staking and the growing network engagement due to GameFi adoption stand as essential catalysts propelling the current AVAX price rally. With these indicators continuing their upward trajectory, it positions AVAX’s price favorably for additional gains. However, a recommendation is that investors should continue to take a defensive investment approach in the weeks ahead, and market sentiment, regulatory developments, and macroeconomic trends will continue to have a major influence in determining the price of AVAX.
Disclaimer: Crypto is extremely volatile and not suitable for everyone to invest in. Never speculate with money that you cannot afford to lose. The information on this site is presented for educational purposes only and should not be construed as investment or financial advice.