- AVAX traders are currently over-leveraged at $34.72 on the lower side and $36.52 on the upper side.
- The altcoin is receiving support from the 200 EMA and $35 level.
Avalanche [AVAX] seems to be badly impacted by the current market sentiment and is currently on the verge of a notable price decline.
The past two months have not been in favor of the bulls, as the altcoin witnessed a price decline of over 35%, from $53 to $35.
AVAX — Major liquidation areas
Amid this bearish outlook, traders found strongly betting on the short side, while the bulls appeared exhausted, as revealed by the on-chain analytics firm Coinglass.
At press time, major liquidation areas were near $34.72 on the lower side and $36.52 on the upper side, with traders being over-leveraged at these levels.
Source: Coinglass
If the sentiment remains unchanged and the price reaches the $34.72 level, nearly $690,000 worth of long positions will be liquidated.
Conversely, if the sentiment shifts and the price rises to the $36.52 level, approximately $3.60 million worth of short positions will be liquidated.
Looking at the potential liquidations, it appears that traders holding short positions outnumber those holding long positions, which indicates a clear bearish signal.
It further suggests that short sellers are currently dominating the asset.
AVAX technical analysis and price action
According to AMBCrypto’s technical analysis, AVAX was at $35 at press time.
This is a make-or-break situation, as AVAX is at the neckline of a bearish head and shoulders pattern and a descending triangle price action pattern.
Source: TradingView
Additionally, AVAX is receiving support from the 200 Exponential Moving Average (EMA) on the daily time frame.
However, this is not the first time the altcoin has reached this level. In the last 30 days, it has reached this level multiple times, and each time it witnessed upside momentum.
Read Avalanche’s [AVAX] Price Prediction 2025–2026
Based on the recent price action and historical momentum, if AVAX fails to hold this level and closes a daily candle below $34, there is a strong possibility it could decline by 17% to reach the $28.50 level in the future.
However, the technical indicator Relative Strength Index (RSI) is at 42, indicating that AVAX has enough strength to hold this crucial level and may soar in the coming days.
