- Avalanche (AVAX) price breached the $40 resistance on Monday, driven by the crypto market’s positive start to 2025 and a Bitcoin rally to $100,000
- AVAX whale wallets recorded positive net inflows for 21 trading days since December 15, making acquisitions worth $600 million
- The RSI technical indicator shows AVAX is approaching market saturation as the latest price surge coincides with declining trading volumes
The cryptocurrency market kicked off 2025 on a high note, with Avalanche (AVAX) making significant strides. The coin breached the $40 resistance level, primarily driven by the overall positive market sentiment.
AVAX’s Impressive Market Performance
Avalanche’s price broke the $43 mark on Monday, bolstered by Bitcoin’s rally to the $100,000 mark which lifted the altcoin markets. The AVAX whale wallets have been recording positive net inflows for 21 consecutive trading days since December 15, making acquisitions worth $600 million. Yet, the Relative Strength Index (RSI) indicator shows that AVAX is nearing market saturation as the latest price surge coincides with declining trading volumes.
Factors Contributing to AVAX’s Rise
The Avalanche coin has been one of the standout performers amid the ongoing bullish start to 2025 in the crypto market. This growth is attributed to positive speculations around the inauguration of United States President-elect Donald Trump and dovish macroeconomic tweaks. Additionally, the recent $250 million fundraising by the Avalanche team has also attracted significant investor attention. As a result, AVAX price action has mirrored Bitcoin’s in the past week, delivering more than threefold gains.
AVAX Whale Activity and Impact
On-chain data trends reveal that whale wallets have been acquiring large amounts of AVAX coins since mid-December, following the Avalanche team’s announcement of a $250 million fundraise for network updates. Over the last 21 trading days, the whale wallets acquired 146 million AVAX worth approximately $595.6 million. This persistent buying pressure from Avalanche whales has been crucial in AVAX price tracking the Bitcoin rally as market sentiment recovers at the start of the year.
AVAX Price Forecast: A Note of Caution
Despite strong whale demand, which saw Avalanche price extend its year-to-date gains to 28%, breaking past the $45 resistance on Monday, technical indicators on the AVAX/USD daily chart suggest caution. The divergence between rising prices and falling volume often signals weakening buyer enthusiasm, indicating the market could be approaching a local top. The RSI is approaching the 60 level, a zone where previous rallies have stalled, hinting at potential reversal risks ahead.
Conclusion
While the Avalanche network continues to show promising growth, investors should proceed with caution as technical indicators hint at a potential market saturation. A careful evaluation of market trends and whale activities will be key to making informed investment decisions in this dynamic market.
