Key Takeaways
- Whale transactions for AVAX have plunged sharply, signaling weakening investor confidence.
- Short positions are rising significantly, increasing the likelihood of further price declines.
Avalanche (AVAX) is facing increasing pressure as bearish sentiment tightens its grip across both spot and derivatives markets. Since early May, AVAX has formed a consistent pattern of lower highs, and the recent breakdown of key support zones is amplifying concerns.
One of the most telling signs of weakness is the retreat of large holders. According to data from IntoTheBlock, whale transactions have dropped sharply. Transfers between $100K and $1 million are down 65%, while transactions in the $1 million to $10 million range have plummeted by 95%. More alarmingly, transfers exceeding $10 million have completely vanished—marking a 100% decline in high-value activity. This mass exodus of deep-pocketed investors suggests waning institutional confidence and structural fragility for AVAX.
Derivatives Market Turns Bearish as Shorts Gain Momentum
Traders are following suit, shifting their focus toward short positions amid growing uncertainty. CoinGlass data reveals a strong bearish leaning among market participants, with short positions heavily concentrated above the $21.39 mark. At press time, AVAX was trading around $20.28.
The derivatives landscape reflects this cautious sentiment. Cumulative short liquidation leverage reached $10.25 million—substantially outpacing the $8.43 million in long leverage between $19.80 and $21.39. The lack of bullish conviction below resistance levels suggests hesitation among buyers and a potential for further downside.
AVAX also experienced a 3.10% drop in price over the last 24 hours, while its trading volume fell by 22%, indicating that traders are increasingly sitting on the sidelines.
Long Liquidations Mount as Price Slips
This price decline has led to a wave of long liquidations, further tilting sentiment bearish. Over the past 24 hours, $290K worth of leveraged positions were liquidated, with $189K stemming from longs alone.
Also Read: Avalanche (AVAX) Tests Key Resistance as Bulls Gain Strength
Despite Binance’s Long/Short Ratio indicating a slightly bullish bias at 2.67, top trader positions were more restrained at 1.72—highlighting cautious optimism that may not hold under sustained selling pressure.
Taken together, declining whale activity, increasing short positions, and mounting long liquidations paint a clear picture: AVAX is in a vulnerable state, and further losses could be on the horizon if sentiment fails to shift.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses
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