- Data from the derivatives market showed that shorts dominated the positions.
- A golden cross on the daily chart suggested an increase to $60 in the near term.
Avalanche’s [AVAX] price increased to $35.77 has once again sparked speculation that the token could hit $100. This recent rise was a 4.30% 24-hour jump.
However, it was still not close to the $61.90 ceiling that the cryptocurrency reached in March.
Despite that, some key indicators suggested that the token might continue its upward run. Firstly, AMBCrypto considered the Funding Rate.
Funding Rate is the cost of holding an open position in the derivatives market. A positive reading of the Funding Rate implies that longs are paying shorts to keep their positions open.
Traders to lose, AVAX to gain
In this case, most bets tilt toward the bullish side. However, negative funding suggests that most traders placed bearish predictions with shorts paying longs.
For context, a long is a trader expecting the price of an asset to increase. On the other hand, a short is one predicting a price decline while hoping to profit from it.
At press time, the aggregated Funding Rate on exchanges was -0.001%. The negative funding while AVAX’s price increases imply that shorts are aggressive.
Source: Santiment
However, they are not being rewarded for their positions. Furthermore, the price increase suggested that spot buyers are on the aggressive end, and this could be bullish for AVAX.
Should the metric remain this way, then the price of the cryptocurrency might attempt to surpass $40 in the short term. From the daily chart, the Money Flow Index (MFI) reading increased.
The MFI shows if capital is flowing into a cryptocurrency or not. If the MFI sustains the increase, and trader do not take their liquidity out of AVAX, then the price might continue to increase.
$100 is coming but not now
AMBCrypto also noticed a support at $32.77, indicating the bulls formed a support and were defending it. On the broader outlook, the 50 EMA (blue) had crossed over the 200 EMA (yellow).
This crossover is termed a golden cross, suggesting that the mid to long-term outlook for AVAX was bullish. With this trend, the price of the token might key into the $60 resistance in the mid-term.
Source: TradingView
Further, AVAX bulls might try to push the price toward the three-digit level. But this might only become plausible in some months, not in a few weeks.
In terms of Open Interest (OI), Coinglass data showed that there was a slight increase. This increase implied that traders have begun to increase more positions to make gains from the price action.
Source: Coinglass
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If the OI continues to increase alongside the price action, AVAX’s price might hit a weekly high before this weekend comes to a close.
So, the $100 prediction remains an option for the token. But this could later on in the year or next.
