Altcoins
How soon can AVAX reach $100? Decoding the rise of altcoin
- Derivatives market data showed that short positions dominated.
- A golden cross on the daily chart suggests an increase to $60 in the near term.
Avalanches [AVAX] the price increase to $35.77 has once again sparked speculation that the token could reach $100. This recent increase represents a jump of 4.30% over 24 hours.
However, it was still not close to the $61.90 high the cryptocurrency reached in March.
Despite this, some key indicators suggest that the token could continue its rise. First of all, AMBCrypto took into account the funding rate.
The funding rate is the cost of holding an open position in the derivatives market. A positive funding rate reading implies that long positions are paying short positions to keep their positions open.
Traders will lose, AVAX will win
In this case, most bets lean towards the bullish side. However, negative funding suggests that most traders have placed bearish predictions with shorts paying for long ones.
For context, a trader expects the price of an asset to increase. On the other hand, short selling involves predicting a price decline while hoping to profit from it.
At press time, the aggregate funding rate on exchanges was -0.001%. THE negative financing while AVAX’s price increases imply that the shorts are aggressive.
Source: Santiment
However, they are not rewarded for their positions. Additionally, rising prices suggest that spot buyers are aggressive, which could be bullish for AVAX.
If the metric remains like this, then the price of the cryptocurrency could try to exceed $40 short term. From the daily chart, the Money Flow Index (MFI) reading increased.
The MFI indicates whether or not capital is flowing into a cryptocurrency. If the MFI maintains the rise and traders do not withdraw their cash from AVAX, then the price could continue to rise.
$100 is coming but not now
AMBCrypto also noticed support at $32.77, indicating that the bulls were forming support and defending it. From a broader perspective, the 50 EMA (blue) has risen above the 200 EMA (yellow).
This cross is called a golden cross, which suggests that the mid-to-long term outlook for AVAX was bullish. With this trend, the token price could enter the $60 resistance in the medium term.
Source: TradingView
Additionally, AVAX bulls might try to push the price towards the triple-digit level. But that might only become plausible in a few months, not a few weeks.
In terms of Open Interest (OI), Coinglass data watch that there was a slight increase. This increase implied that traders had started increasing their positions further to take advantage of the price action.
Source: Coinglass
Is your wallet green? Check the AVAX Profit Calculator
If OI continues to rise alongside price action, AVAX price could reach a weekly high before the end of this weekend.
So, the $100 prediction remains an option for the token. But that could happen later this year or next year.