Avalanche – 27% crash, $222mln wiped – Here’s why bulls still eye $30!

Key Takeaways

What caused AVAX’s sharp 27% crash?

A sudden market shock flipped risk sentiment, liquidating overexposed AVAX longs, despite smart money already stacking for a breakout around $25.

Why is Avalanche showing signs of a rebound?

Strong spot demand and heavy on-chain accumulation shook out weak hands, with bulls taking back control around the $22 bid wall.

Avalanche [AVAX] pulled off a nasty crash, catching bulls off guard.

As AMBCrypto highlighted, smart money was actively accumulating AVAX during its sideways consolidation around the $25 level, with roughly $6 million in strategic accumulation, positioning for a potential breakout.

However, the timing proved disastrous. Following the market shock, risk sentiment shifted sharply, triggering a broad sell-off.

AVAX was not spared. It plunged 27%, emerging as one of the worst-hit assets in the downturn.

Source: TradingView (AVAX/USDT)

The domino effect? About $222 million in 24-hour liquidations, with 93% coming from long holders.

Not too surprising.

Bulls were already stacked for a breakout while AVAX chopped sideways for two weeks.

Looking at the AVAX/USDT perpetuals on Binance, the long skew was clear. Roughly 70%+ of positions were long over the past month, meaning a ton of overexposed leveraged bets were sitting just under the price.

If the Spot bid stays solid, this could turn into a textbook leverage flush. Weak hands shaken out, strong hands absorbing the supply.

The question is, will bulls double down for a breakout, or does the FUD keep them sidelined?

AVAX accumulation signals bulls aren’t done yet

In just five minutes, AVAX bulls flexed hard. 

During the market bleed, Avalanche dumped 50% down to $10, but then staged a staggering 143% snapback in the next five minutes, reclaiming a $22 valuation.

On-chain flows confirmed the action.

DeFiLlama showed token Volume spiking from $589 million to $2.8 billion at press time. In trader speak, buyers were aggressively soaking up supply, showing strong Spot demand and heavy accumulation under the price.

Source: DeFiLlama

And it doesn’t stop there.

AVAX’s DEX Volume blew up to $827 million, marking the biggest single-day spike in two weeks.

Put simply, traders were actively swapping, aligning with its 9.85% intraday pop, showing bulls stepping in hard.

The pullback? Just a classic shakeout of overheated longs.

Now, a solid bid wall is stacking around $22. With leverage cleared out, this could set the stage for AVAX to start climbing toward that $30 breakout.