Avalanche (AVAX) broke above the upper line of a descending channel on May 13, and its price has since climbed by almost 10%.
However, this rally might be shortlived, as on-chain data suggest a decline in the altcoin’s demand over the last week.
Avalanche Whales Seek to Avoid Trouble
An assessment of AVAX’s user activity in the past seven days revealed a drop in demand for the 25th-largest cryptocurrency by market capitalization.
During that period, the daily count of active addresses completing transactions involving AVAX plummeted by 18%.
The altcoin also witnessed a decrease in new demand. In the past week, the number of new addresses created daily to trade AVAX dropped by 2%.
In addition, AVAX has experienced a month-long decline in whale activity. While its price broke above resistance on May 13 and has continued its uptrend, AVAX’s large investors have reduced their exposure.
Read More: How To Buy Avalanche (AVAX) and Everything You Need To Know
Avalanche Whale Activity. Source: IntoTheBlock
Over the past 30 days, the number of AVAX transactions valued between $10,000 and $100,000 has declined by 26%. Similarly, transactions ranging from $100,000 to $1 million have seen a 17% decrease during the same timeframe.
AVAX Price Prediction: Weakening Uptrend Puts Token at Risk
Despite AVAX’s price growth since it broke above the upper line of its descending channel, its Aroon Up Line has trended downward.
This indicator identifies an asset’s trend strength and potential reversal points in its price movement. When the Aroon Up line is close to zero, the uptrend is weak, and the most recent high was reached a long time ago. This can indicate a potential trend reversal.
At press time, AVAX’s Aroon Up Line was 28.57%.
Also, readings from the Parabolic Stop and Reverse (SAR) indicator put its dot above AVAX’s price at press time.
This indicator identifies an asset’s potential trend direction and reversal points. When its dotted lines rest on an asset’s price, it is a bearish sign, indicating that the asset’s price may initiate a decline.
If the bulls fail to sustain AVAX’s current rally and the bears regain full market control, the token’s price might plummet to $34.99.
However, if this projection is invalidated and adequate liquidity enters the market, AXAX’s price may rise toward $37.45.
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