Avalanche Price Analysis – AVAX Bulls Target $11 Following Increased Inflows and Positive Derivatives

Highlights:

• The Avalanche price is up by 7% over the past week to trade at $9.14 today.
• Derivatives market shows a surge in open interest, as the funding rate remains positive.
• The technical outlook shows intense bearish pressure, as AVAX bulls target the $11 mark.

At the time of writing on Wednesday, Avalanche (AVAX) price is trading at $9.14, marking a 7% rise over the past week. Meanwhile, the spot exchange-traded fund (ETF) VAVX of VanEck has recorded its biggest one-day inflow on Tuesday since January. At the same time, a combination of signals on derivatives is still putting pressure on the price recovery of AVAX.

According to the SoSoValue chart, VanEck spot ETF, VAVX, had an inflow of $4.26 million on Tuesday. This is the largest inflow it has ever had in a single day since its inception in January. Although this was the institutional need, AVAX price is still in the red today, highlighting some structural selling and weakness of conviction in traders.

On the derivatives, Avalanche futures Open Interest (OI) has increased by 0.50% to $399 million. This increase in OI indicates a growing investor participation and is indicative of a bullish attitude. Moreover, the options volume and options OI have increased by 2046% and 13%, respectively. The long-to-short ratio also sits at 1, indicating growing bullishness in the Avalanche price. 

Nevertheless, the funding rates of AVAX have a positive perspective. The metric had become a positive value on Monday and 0.0043% on Wednesday. The positive rates indicate that longs are paying short indicating that the bullish sentiment is in AVAX. With positive momentum building, the Avalanche price is set for a rebound as retail demand spikes.

AVAX Price Target $11 Barrier Despite Weak Technicals

The AVAX price is showing signs of recovery after bouncing from the recent lows at $7.55, currently exchanging hands at $9.14. The $7.55 zone has held a strong support base, preventing any further downside in the AVAX market.

The chart shows that the price has been in a prolonged downward trend within a falling channel. The token is currently trading at $9.14 and is sitting just below both the 50-day Moving Average (MA) and 200-day SMA at $11.66 and $18.59, respectively. The RSI is at 38. This shows that the bears are still having control in the market, as the RSI sits below the neutral zone. 

In the meantime, if the Avalanche price can break above the $11.66 level, it could lead to more upside. This breakout could open the doors towards further upside, including the $12.30-$15. However, a clean breakout above the long-term barrier at $13 will flip the market bullish, tilting the odds towards the bulls. 

Conversely, if AVAX fails to stay above $11 and breaks below the $8.63, it could drop to the recent low of $7.55, last seen on Feb 5. In short, the AVAX token is at a critical zone. If the token holds above the current levels, it could fuel a fresh rally. However, investors should watch closely to confirm whether bulls can hold the $11 mark, as the technicals still hold mixed sentiments.