AVAX sees 12% price jump as Grayscale launches Avalanche Trust

AVAX, the native token of layer-1 blockchain Avalanche, has seen a 12% increase in the past 24 hours, making it one of the best performers among the top 100 cryptocurrencies by market cap.

After nearly six months of declines, the Avalanche (AVAX) price appears to be in the early stages of a potential trend reversal. On Aug. 5, the token hit a nine-month low of $17.29. However, it has gained 48% in the past two weeks to $25.78.

AVAX 24-hour price chart – August 23 | Source: crypto.news

At the time of writing, AVAX’s daily trading volume was around $511 million and its market cap was $10.4 billion, according to data from Crypto.news.

Although AVAX experienced a sudden drop like many other altcoins, falling to $17.55 during Bitcoin’s drop to $49,500 on August 5, it has underperformed the broader market since its peak of $65 on March 18.

The recent positive movement in AVAX’s price may have been driven in part by encouraging news. Investors have focused on the Avalanche token unlock program, noting that the frequency of token unlock events will decrease significantly after the end of 2024. Many believe that these unlocks create selling pressure and hinder the long-term ecosystem growth that is crucial to the token’s appreciation.

Only after 2024 #Avalanche Foundation will unlock tokens. All others will be unlocked.

On-chain unlocks are much more transparent than random token sales from other organizations#AVAX The foundations are opened on specific dates and happen on-chain, it is predictable and anyone can plan for it. pic.twitter.com/DtsJnH3ElC

— REKTBuildr 🔺🔺🔺 (@rektbuildr) February 22, 2024

Additionally, on August 22, Grayscale Investments announced the launch of the “Grayscale Avalanche Trust,” providing investors with exposure to the Avalanche ecosystem. On the same day, global asset manager Franklin Templeton expanded the Franklin Onchain US Government Money Fund to the Avalanche network in response to growing investor interest.

While these developments (such as the token unlock schedule and announcements from Grayscale Investments and Franklin Templeton) are not directly related to AVAX’s fundamental value, they may have contributed to a more positive sentiment among investors and boosted the token’s price outlook.

AVAX sees bullish trend in the market

AVAX’s price is currently positioned above the upper Bollinger Band at $24.79, suggesting that AVAX is trading beyond the typical range of recent price swings and that there is a potential strong uptrend in the market. Such a positioning above the upper band could indicate overextension in price action and signal an impending pullback or consolidation if not supported by additional buying pressure.

AVAX Bollinger Bands and RSI chart | Source: crypto.news

The Relative Strength Index for AVAX currently sits at 61.47, which puts it slightly above neutral territory but still well below the overbought threshold of 70. This means that while the market is experiencing some bullish momentum, it is not yet at a level that typically signals an imminent reversal due to being overbought.

The trading volume recorded at 1.072 million AVAX reflects active participation and can be considered supportive of the current price rally, indicating genuine market interest rather than a fake increase. With the price breaking above the upper Bollinger Band, combined with a moderately high RSI and solid trading volume, the market dynamics around AVAX point to a strong bullish undertone but should be closely monitored for signs of potential volatility or price corrections.

Investors and traders may want to keep a balanced outlook in view of the heightened market activity, keeping an eye on stability above the upper band or a possible pullback towards the mid-band level at $21.58 as indicators for future price movements.