Avalanche (AVAX) saw its price reach a high of $59 on March 26 as it made a bold attempt to break through the $60 resistance level. On-chain data trends indicate that recent team announcements have played a significant role in driving this bullish momentum.
With a remarkable 43% increase in price, Avalanche has established itself as one of the top-performing Layer-1 altcoins since March 11, surpassing the likes of Ethereum (ETH) and Ripple (XRP).
The question now arises: can the recent positive team developments propel AVAX towards the $70 milestone?
Avalanche has experienced an influx of new users into its ecosystem following recent team announcements. The Avalanche team has been actively working to enhance its services and attract users amidst the current crypto market trends.
One such announcement came on March 21, when the Avalanche foundation introduced a $1 million “Memecoin Rush” fund in response to the meme coin craze that saw the Solana ecosystem attract billions in capital inflows. This fund aims to incentivize developers and liquidity providers to support community-owned meme projects.
Additionally, on March 23, a collaboration between the Australia and New Zealand Banking Group (ANZ) and Chainlink Labs was unveiled, showcasing a connection between blockchains such as Avalanche and Ethereum for the global movement and settlement of tokenized assets.
These significant announcements have sparked a notable increase in the organic growth of the Avalanche ecosystem, as evidenced by recent data trends.
The chart above illustrates an uptick in AVAX’s new adoption rate since the announcement of the $1 million memecoin fund. Recent data shows that 25.4% of all transactions on the Avalanche network on March 25 were from first-time users, surpassing the 30-day average of 22.4%.
A surge in new-user transactions can have a positive impact on the asset’s price for several reasons. A broader user base and increased network effect can enhance the ecosystem’s resilience and long-term viability. Moreover, a larger user base can lead to increased transaction volume and liquidity, which are typically favorable for price appreciation.
Furthermore, new users often bring fresh capital into the market, creating upward pressure on prices. Additionally, new users may hold onto their assets for longer periods, reducing available supply and supporting prices.
Based on the recent increase in new-user transactions and the overall optimistic sentiment generated by recent team announcements, AVAX’s price appears poised to make a move towards $70.
However, data from Coinglass’ Liquidation Map indicates that AVAX bulls may face challenges in surpassing the $60 resistance level. Short traders have established leveraged positions that could result in a loss of $27.8 million if prices exceed $60.9. These traders may implement strategic stop-loss orders as AVAX approaches this crucial area.
Nevertheless, if the rising demand from new users continues, AVAX could break through the sell-wall and target the $70 mark. On the other hand, if sell-offs trigger a market downturn, AVAX’s price could drop below $50. In this scenario, long traders may regroup to form a support buy-wall at the $53 level to protect their active leveraged positions.