AVAX, the token of the Avalanche blockchain, made headlines again after registering significant gains, despite the correction it is currently experiencing.
At the time of writing, the price of AVAX is trading at $24.6, with daily gains of 0.5%, weekly gains of 26%, and monthly gains of 25%.
Why is the price of AVAX rising?
The strong gains of Avalanche coincide with the overall recovery in the cryptocurrency market. As BTC manages to stay above $100,000, the outlook becomes highly favorable for altcoins.
However, AVAX also has its own factors that explain its rise. One of them is the growing ecosystem of stablecoins thriving on Avalanche, directly boosting the demand for the token.
Currently, stablecoins move an average of $1.3 billion daily on this network. This high volume of transfers suggests the influx of new capital into the ecosystem and an increase in the use of Avalanche as a network for transactions.
The sustained growth in the use of stablecoins is often a sign that more users are preparing to invest or conduct business transactions.
Analyst Jay Kurahashi shared relevant data about the all-time high of daily transactions reached on May 12, when Avalanche surpassed 8.8 million:
"Yesterday, AVAX quietly set all-time highs at 8.8 million daily transactions, all completed instantly. Something is happening in Avalanche."
Other data to consider about Avalanche
Activity on Avalanche has grown significantly: the number of daily active users rose to 251,140, representing an increase of 554% compared to the average of the last 30 days.
In the last week, the number of active users increased by 755.5%. Although the starting point was low, there are now 29,360 active users.
Between March and April, Avalanche handled between $600 million and $1 billion in transfers daily. However, since May, the volume has grown and on some days has surpassed $1.3 billion.
Last Sunday, the total market value of cryptocurrencies increased significantly, reaching $3.34 trillion. Today, that figure remains close, at $3.33 trillion, marking a clear difference from the $2.68 trillion recorded on March 13.
Analysis of AVAX charts: signals, resistances, and supports
After several months in which its price was declining within a bearish channel, AVAX has shown signs of a possible trend change. On the daily chart, the price broke the pattern of 'descending wedge.'
The key is that AVAX surpassed $22.50, a zone that had acted as resistance. By surpassing that level, the possibility of a reversal towards a bullish phase is activated.
Resistances to keep in mind:
$26.8: yesterday's high and the zone where the price found a ceiling.
$30.0: a relevant psychological level that could act as strong resistance.
$38.0: if the price surpasses $30.0, this could be the next major resistance.
Supports to watch:
$23.4: the immediate support corresponding to the daily low.
$20.0: an important psychological support, although not the strongest in this context.
$17.5: the strongest support if the price falls more intensely.
The RSI at 52 points shows that the bears are gaining ground and the next direction of the price is still unclear.
