AVAX Price Stalled, But Open Interest Spikes Signaling a Potential Breakout

Avalanche price stalled around the $21 mark on Thursday, August 15, maintaining its position above the $20 support level since the week's start.

Avalanche (AVAX) price has stalled around the $21 mark on Thursday, August 15, following a period of strong buy-ups that began last week. The bears have been mounting pressure on the $20 support level, but the bulls have managed to keep the price above it so far this week.

However, technical indicators and market sentiment suggest that an imminent breakout from the $20 support is brewing. The Parabolic SAR (Stop and Reverse) indicator currently shows support at $18.17, indicating that the bears have failed to push the price below this key level.

At the same time, the Donchian Channels, which measure volatility, are tightening, indicating reduced price movement. This often precedes a significant breakout. With resistance at $23.42, a break above this level could see AVAX retesting the $25 mark.

To add to the bullish case, the release of dovish CPI inflation data by the US Bureau of Labor Statistics on August 14 has shifted sentiment in the derivatives markets. Open Interest, a key metric for price insights, has seen a notable increase.

From $182 million on August 12, Avalanche’s Open Interest climbed to $201.6 million by August 15. This represents a $19.6 million increase, or approximately 10.77%.

During this period, AVAX’s price remained relatively stable, further suggesting potential bullish momentum.

When Open Interest increases during a period of price consolidation, as currently observed, it often signals that a significant price movement is on the horizon. Two reasons this could be bullish for AVAX include renewed trader confidence in the asset and the possibility of a short squeeze if bears cannot push the price below key support levels.

Overall, the technicals and market fundamentals are aligning to suggest that a breakout from the $20 support is likely. If AVAX maintains its current support and the Open Interest continues to rise, a bullish breakout seems increasingly likely.

Traders should watch for a decisive move above $23.42, which could signal the start of a new upward trend toward $25 and beyond.

The above is the detailed content of AVAX Price Stalled, But Open Interest Spikes Signaling a Potential Breakout. For more information, please follow other related articles on the PHP Chinese website!