AI Predicts Avalanche (AVAX) Price for the End of 2023

 Key takeaways

• Avalanche (AVAX) has enjoyed a period of sustained upside since October and looks bullish heading into 2024
• The blockchain benefited from a surge in trading volume following the launch of StarsArena, which seems to have reignited interest in the Avalanche network despite some unfortunate events
• The AVAX price prediction algorithm expects AVAX to consolidate close to its range highs, which would be a strong way to follow up from a +167% move in the past 3 months

AVAX price prediction: Algorithm expects short-term consolidation heading into the new year

The current price of Avalance (AVAX) is $26.46 following a +3.62% move in the past 24 hours. AVAX has also risen +167% in the past 3 months and +142% YTD.

The positive performance from AVAX is testament to a bullish period of price action for the wider crypto markets over the course of the year. Bitcoin (BTC) has risen +161% YTD while the total crypto market cap (TCAP) is up +103% in the same time frame.

Having outperformed the TCAP since January, the bullish momentum for AVAX looks set to continue heading into the new year. The AVAX price prediction algorithm expects a brief consolidation around the range highs which have been formed during the recent surge.

AVAX climbed to its current price from a low of just $8.77 in September. The AI algorithm expects a minor rise between now and 2024, posting a forecast that would take AVAX to $28.58 by 6th January 2024. In total, this would be a further +7.92% gain and some bullish price action considering the strength of the move in recent months.

Could SocialFi have injected fresh bullish momentum into Avalanche in recent months?

The Avalanche blockchain saw a spike in trading volume at the beginning of Q4 2023. The launch of StarsArena as a FriendTech competitor on the network led to an influx of users and liquidity. In the space of just two days at the beginning of October, real trading volume surged by +192%.

Unfortunately, StarsArena suffered a hack shortly afterwards which led to an instant crash in real trading volume. Despite the problem, all Avalanche users were reimbursed and the blockchain has continued to surge upwards. It seems as though StarsArena reignited interest in the blockchain at a key time.

The beginning of October coincided with a major trend reversal from AVAX and the cryptocurrency has been in an uptrend ever since. At the time of writing, AVAX is almost 3x up from the lows and the market cap has risen from $3.27 billion to $9.70 billion since October 1st.

Is AVAX overextended, or is it a mean reversion?

The multi-month uptrend has culminated in AVAX hitting a key resistance level that can be traced back to the 2021 crypto bull market. The move from October until now has also filled a significant fair value gap from the downtrend that followed the previous all-time high, as AVAX has now re-entered an area of historical interest.

The range highlighted below marks confluence between AVAX’s first 2021 high, its retest level following a swing failure back to new highs later in that year, and also a retest level during the 2022 bear trend.

One thing that is certainly worth noting is that AVAX looks overextended on the daily time frame, but that doesn’t necessarily mean that the current impulsive wave is finished. Traders may find out just how bullish AVAX is by looking at the depth of the next pullback.

If there’s a deep pullback, then AVAX may have run out of steam for the time being due to a major move in recent months. If the next pullback is shallow, then traders can expect a brief consolidation around the current level before a significant breakthrough takes place heading into the new year.

AVAX price chart showing a +200% move with very little downside in that time, via TradingView

The bottom line

The AVAX price prediction algorithm has forecasted a shallow consolidation for AVAX before the end of 2023. If the cryptocurrency is able to hold its value close to the range high, then traders can see this as a confirmation of the recent momentum and AVAX may soon look to break through to higher price targets.

The strength of the recent move does also contain some risks for new entrants into the market. Major moves can often be followed by a short-term retracement, and this can take place without undermining the overall price structure.

On a macro level, AVAX certainly looks bullish heading into 2024. The question of whether or not it holds strong at the current area of interest, in confluence with the AI prediction, could be the key for its short-term price action during December.