At the end of July, Avalanche (AVAX) prices surged past $33, but this high was short-lived. Since then, the token has experienced a decline of approximately $12, with further drops possible if bearish tendencies persist. This trend is substantiated by price charts, indicating a broad sense of caution among investors.
Why Is IOMAP Important?
The In/Out of the Money Around Price (IOMAP) is a key metric used to predict the potential movements of AVAX. This on-chain indicator provides insights into the number of addresses holding tokens at profit, breakeven, or a loss. Such data is critical for identifying support and resistance levels, which can guide investment decisions.
For instance, 7.26 million AVAX tokens were acquired at an average price of $21.12 by 82,670 addresses, creating significant support above this level. Conversely, 1.02 million tokens were bought at $19.95 by 70,930 addresses, providing another key level where sales might occur.
What Are the Future Price Projections?
AVAX’s recent performance is moderate when compared to the broader cryptocurrency market. Between July 22 and August 6, AVAX saw a 40% price correction, causing concern among its investors. The token has consistently traded below its 20-day Exponential Moving Average (EMA), signaling a bearish trend.
The current price position below the EMA suggests a downward trend. Should buying pressure weaken further, AVAX may drop to $19.56, and potentially to $17.03 if the downward momentum continues. Conversely, if buying interest picks up, AVAX could target $23.07 and possibly surpass the EMA at $24.25, pushing the price to $26.64.
Key Takeaways for Investors
- The IOMAP metric provides critical support and resistance levels at $21.12 and $19.95, respectively.
- A sustained drop below the $21 level could trigger further declines to $19.56 or even $17.03.
- A reversal in trend could see prices rise to $23.07 and potentially $26.64.
In conclusion, AVAX’s current price action paints a cautious picture for investors. While there are opportunities for gains if the trend reverses, the token’s decline below significant support levels warrants careful monitoring. Investors should weigh these factors when making decisions, keeping an eye on both IOMAP data and broader market trends.