Avalanche (AVAX) price retested the same support band that held the market together since March, and the pressure around this level is unmistakably heavier than before.
A top analyst on X told his audience that this level represents a high demand zone among smart money investors. Entering the market at this level introduces a balanced risk to reward ratio.
AVAX Price Breaks Support at $16, What Next?
As @ali_charts shared on X, the $16 zone has acted as a reliable floor for nearly eight months. Each touch of this level has sparked a meaningful rebound.
However, this time AVAX price broke this key support level, and in a very different backdrop too.
As the market momentum fades, price structure weakens, and the overall crypto markets trend slips into exhaustion.
On the daily chart, it was hovering directly above the 50-EMA. This moving average has served as a primary trend guide for most of the year.
Every decisive move below it—on any major timeframe—has historically triggered a deeper, more sustained selloff.
Losing the 50-EMA this time, it broke not only the March support but also aligned with the pattern of higher-timeframe trend stability.
Under such conditions, the dump doesn’t just continue—it accelerates. The weekly chart paints the larger picture with even more clarity.
AVAX is trading in what Carl Moon called a “deep discount zone,” a setup he pointed out two days ago.
The structure suggests that if this floor collapses, price could slide into the “smart money buy zone” sitting lower, where long-term players typically accumulate after capitulation.
That region aligns closely with the bear-market lows, and the chart’s symmetry implies the market may need to revisit those depths before forming a true macro bottom.
Still, not everyone sees this as a threat. REKTbuildr that the pattern resembles a potential bottoming structure.
And indeed, AVAX has shown this behavior before, violent wicks into support followed by sharp recoveries.
Yet the difference now is the growing confluence of weakening indicators, declining momentum, and repeated failures to build higher highs.
When price keeps returning to the same support with increasing force, it usually means demand is thinning.
If Avalanche loses the 50-EMA and the $16 shelf that anchored the market since March, the move down is unlikely to be gentle. The charts suggest the real selloff starts below this line, not above it.
And unless bulls reclaim strength quickly, AVAX price may be preparing for the kind of deeper flush that historically precedes major long-term accumulation.
Derivatives Data Suggests Futures Traders Are Bracing
According to Coinglass, Avalanche (AVAX) derivatives market is cooling sharply, and the data points to a market losing momentum rather than preparing for an immediate rebound.
Volume has dropped by more than 50%, a steep contraction that often signals fading speculative interest.
At the same time, open interest has slipped, though only slightly. That combination usually indicates traders closing positions rather than building new ones.
When both metrics fall together, it reflects a market stepping away from risk. However, the long/short metrics tell a different story. Across exchanges, traders are leaning heavily long.
The 24-hour long/short ratio holds above 1.0, while Binance and OKX show even more aggressive positioning, with long ratios stretching well beyond 2.0 in several categories.
Top traders are clearly positioning for upside, but in a declining-volume environment, such confidence can become a liability.
When conviction rises as liquidity thins, markets often become vulnerable to sharp squeezes. Liquidation data reinforces that pressure is building.
Over the past 12 hours, nearly $418K in positions have been wiped out, with the majority coming from short traders.
But the 24-hour view shows the reverse: more than $600K in long liquidations—three times higher than shorts. This suggests bulls are starting to lose their footing as price attempts to stabilize.