Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Near-term bulls face two critical hurdles
- Open interest, negative funding rates declined
The May CPI report indicates that US inflation continues to cool. It remains to be seen if the Fed will be influenced to pause rate hikes based on the data and other variables.
Read Avalanche’s [AVAX] Price Prediction 2023-24
But the crypto market posted mixed results after CPI data. In particular, Avalanche [AVAX] attempted a recovery but hit a key resistance level in December 2022/early January 2023. Besides, more roadblocks ahead could delay a sharp upside move for the altcoin.
Can bulls bypass the roadblocks?
The RSI and CMF have improved steadily in the past few days. It shows increased buying pressure and capital inflows for AVAX. But the RSI headed into the median level and could face little resistance before moving forward.
Besides, there are two FVG (fair value gap) zones of $11.7 – $13 (white) and $13.2 – $13.7 (red). The latter sits close to the previous range low of $13.7, while the former aligns with the late December/early January resistance level ($12.1).
It means the stretch above the current price level up to the range low is a resistance area. A negative price reaction from the above bearish zone could drag AVAX lower to $11.2 or $10.
However, a bullish BTC, especially above $26.6k, could tip AVAX to cruise across the above bearish zone. A session close above the range low could offer bulls more edge to target higher resistance levels at $14.5 and $15.
OI and funding rates were negative
Bulls could still have a hard task given the decline in OI (open interest) rates from >$60 million to below $40 million on the Binance exchange. It denotes a bearish stance on the futures market.
How much are 1,10,100 AVAXs worth today?
The above negative sentiment is further supported by the negative funding rates recorded from 10 June. Although the negative funding rates eased considerably in the past three days, most exchanges were yet to record a positive rate for AVAX.