Journalist
Posted:
- Avalanche’s daily active addresses and TVL have risen sharply over the past month.
- AVAX rose 30% in the last seven days, but indicators turned bearish.
Avalanche [AVAX] recorded a huge spike in fees generated in the recent past, due to high usage.
While this appears to be a positive sign for the blockchain alone, it could have a broader impact on the ecosystem as such incidents have historically always been accompanied by price increases.
Is Avalanche planning something?
Thor Hartvigsen, a popular DeFi researcher, recently posted a tweet revealing a major development in the Avalanche ecosystem. The blockchain recently witnessed a surge in fees generated as its value reached $3.5 million.
Yesterday @avax generated $3.5 million in fees from onchain activities.
This is almost 2x the previous all-time high of the previous bull.
Active users are up another ~2.5x in the past month.
Red coin Gud coin?🔺 pic.twitter.com/1DJiAh1lsY
— Thor⚡️Hartvigsen (@ThorHartvigsen) December 16, 2023
Not only that, but AMBCrypto’s analysis of Artemis’ facts revealed that Avalanche’s daily active addresses have also skyrocketed over the past month. A similar upward trend was observed in terms of the TVL, indicating growth in the DeFi ecosystem.
Source: Artemis
If we look at history, the last time AVAXThe fees soared and the price also gained bullish momentum. Such an incident last occurred between January and April 2023, when its price rose markedly.
This time the increase in fees was twice as much compared to the previous one.
Source: Santiment
Will AVAX continue its rally?
The effect of the fee increase was also visible this time, as AVAX was among the only top coins to register double-digit gains. According to CoinMarketCapIn the last seven days alone, AVAX rose more than 30%.
At the time of writing, it was trading at $42.30 with a market cap of over $15.57 billion.
However, Avalanche’s growth rate slowed as its price rose only 1% in the past 24 hours. Therefore, AMBCrypto checked the token’s daily chart to see what to expect next.
According to our analysis, AVAX‘s MACD continued to support the bulls. The Chaikin Money Flow (CMF) was also well above the neutral line.
Nevertheless, the Money Flow Index (MFI) was in the overbought zone, which could depress the token’s price in the coming days.
Moreover, Avalanche’s price had reached the upper limit of the Bollinger bands. This meant that selling pressure on the token could increase and in turn reduce its price.
Source: TradingView
Realistic or not, here it is The market capitalization of AVAX in terms of BTC
Avalanche has also witnessed a decline in social metrics in the recent past, as evidenced by the decline in social metrics at the time of writing the report.
Moreover, despite the enormous increase in value, AVAXWeighted sentiment fell sharply, meaning negative sentiment was dominant in the market.
Source: Santiment