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Avalanche (AVAX) has been in a negative mood since March 18, 2024, falling from $65.38 to a low of $21.84. The current price of AVAX stands at $25.32, and traders should keep in mind that a risk of further decline still persists.

Crypto analysts are concerned that should Bitcoin fall below $55,000, it could trigger a larger sell-off, potentially making it challenging for AVAX to maintain its current price levels. At the same time, the macroeconomic landscape remains uncertain; major central banks continue to keep interest rates at high levels, and risk-on assets such as cryptocurrencies could suffer even more in such conditions.

So where is the price of Avalanche (AVAX) going next, and what can we expect from the rest of July 2024?

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.

A platform for building decentralized applications

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.

Similar to numerous other cryptocurrencies, Avalanche (AVAX) remains under pressure after Bitcoin’s price weakened below $60,000. The global cryptocurrency market capitalization continues to drop which is certainly not favorable for AVAX and over the past 24 hours, it fell 3.2%, currently standing at $2.15 trillion. However, the decline in AVAX’s price is not solely due to a negative trend on the cryptocurrency market and it also reflects a significant decrease in the number of large trades involving AVAX.

Large trades often contribute significantly to the liquidity and a decrease in such trades can reduce the overall liquidity, making it more difficult for traders to buy or sell large amounts of AVAX without affecting the market price. With reduced liquidity, the market may become more susceptible to price swings and potential investors should keep in mind that smaller trades could have a more pronounced impact on AVAX’s price then.

At the same time, a decline in large trades might be interpreted as waning confidence among large holders or institutional investors. This could negatively affect market sentiment and potentially lead to further declines in AVAX’s price as other investors follow suit.

Bears continue to control the price

The start of July has been bearish for Bitcoin, AVAX, and the broader cryptocurrency market due to several events that have shaken the market. The anticipated debut of Spot Ethereum ETFs on July 2nd did not occur, and reports indicate that the US and German governments have been selling large amounts of BTC. However, some analysts say that a potential shift in momentum for Bitcoin and the broader crypto market may be on the horizon with the release of CPI data on July 11.

With the inflation data expected to come in lower, this could point to an immediate rate cut or at least a further rate cut by the Fed going forward. Naturally, such rate cuts would be good for the cryptocurrency market and AVAX as they have been in the past. Positive info is that according to a new report by analysts from the Bitfinex exchange, after facing a massive sell-off, Bitcoin probably reached a local bottom.

Fundamentals of AVAX are strongly tied to the overall cryptocurrency market (especially with Bitcoin), and if the price of Bitcoin jumps above the $65000 resistance again, we could see AVAX at higher price levels. At the same time, the expanding number of decentralized applications (dApps), decentralized finance (DeFi) projects, and non-fungible tokens (NFTs) built on Avalanche is also something that could propel its price again.

Avalanche’s high throughput, low latency, and interoperability make it an attractive platform for developers while a robust and active community continues to drive growth on the platform. Collaborations with prominent projects in the blockchain space enhance Avalanche’s credibility and this could again increase interest among investors and provide new capital inflows.

Technical analysis for Avalanche (AVAX)

Avalanche (AVAX) has weakened from $65.38 to $21.84 since March 18, 2024, and the current price stands at $25.32. A decline in the price can be attributed to several factors, with the most significant being a shift in market sentiment from positive to negative. As long the price of AVAX is below the resistance which I marked on the chart below, the risk of further decline still persists.

Important support & resistance levels for Avalanche (AVAX)

On this chart (the period from January 2024), I marked important support and resistance levels that can help traders understand where the price could move. AVAX has weakened from its recent highs, but if the price advances above $35, the next target could be an important resistance level at $40. The strong support level is $20, and if the price breaks this level, it would be a “SELL” signal, and we have the open way to $15.

What speaks for the rise in the Avalanche (AVAX) price

General market sentiment is an important factor that influences AVAX’s price but positive news, partnerships, and developments related to Avalanche can attract investors and traders, pushing the price up. Analysts and traders often closely watch the activity of crypto whales because the behavior of crypto whales can influence market sentiment and an increase in the number of big transactions for AVAX is something that could drive the price higher. When a whale makes a substantial buy, it can be seen as a bullish sign, potentially attracting more buyers. For the bulls to take again control of price movement, a move above $40 would be beneficial.

What indicates the downfall of Avalanche (AVAX)

Avalanche (AVAX) is unpredictable and a risky investment, and because of this, investors should continue to be very cautious in the case of this cryptocurrency. At the same time, the macroeconomic landscape remains uncertain; major central banks continue to keep interest rates at high levels, and risk-on assets such as cryptocurrencies could suffer again in such conditions. The important support level for AVAX stands at $20, and if the price falls below this level, the next target could be the next support that stands at $15.

What do analysts and experts say?

Avalanche’s popularity is on the rise in 2024 due to collaborations between traditional financial giants like JPMorgan and Citi but it is also important to say that many other significant projects have extended their operations to the Avalanche blockchain. However, crypto analysts are concerned that should Bitcoin fall below $55,000, it could trigger a larger sell-off, potentially making it challenging for AVAX to maintain its current price levels.

There has also been a significant drop in the number of whale transactions for AVAX in the last several weeks, and when whales reduce their trading activity (transactions worth $100,000 and above), it usually indicates that they are losing confidence in the underlying coin’s short-term price prospects. Because of this, some crypto analysts say that the fact that bigger investors have lost interest in accumulating AVAX indicates that we will continue to see low prices for this crypto.

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.

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