Avalanche Price has increased by 7.80% in the last 24 hours, according to data from CoinMarketCap. At the time of writing, the token is trading at $37.48. Surprisingly, this increase occurred less than four days before the project's next token unlock.
According to data from the Token Unlocks platform, AVAX will release 2.49% of its total supply into circulation on May 22. This ratio represents 9.54 million tokens, worth $329 million. When released, it means that 62.49% of the total supply of AVAX will be part of the circulating supply.
AVAX Token Unlock and Its Impact
Unlock tokens are not always a good thing considering they come with high volatility. The bigger the unlock, the harder the price drops. However, projects that have invested around 60% to 70% of their supply tend to experience low volatility. In some cases, they come at a higher price, especially in the early stages of the unlock schedule. Interestingly, this appears to be the case with AVAX.
AVAX On-Chain Analysis
To ascertain a token's potential, AMBCrypto looks at what happens with the token on-chain . Our first observation is a rising Weighted Sentiment. At the time of writing, the Weighted Sentiment around the Avalanche project is -0.036. Although the reading was negative, it was a marked improvement from -0.574 on May 15, indicating that participants abandoned their bearish bias. Like sentiment, Social Dominance is also surging. At the time of writing, this metric was 1.046%, which means that discussions about the project have increased.
AVAX Price Prediction
The combination of negative sentiment and an increased share of social dominance could be good for the price. This could push AVAX price to $40 in the short term, or a very bullish target of $43.50 before the scheduled unlock. However, traders may need to exercise caution. If social dominance becomes too high, it could be a sign of FOMO .
FOMO is an abbreviation for Fear Of Missing Out. The last time the metric was higher than the press time reading, AVAX fell from $35.08 to $31.42 in three days. On the other hand, if sentiment surges into positive territory, the bullish thesis could be validated. Additionally, volume has supported price increases.
At the time of writing, Santiment on-chain data revealed that AVAX volume reached $534.57 million—the highest it has ever been in the last seven days. If volume continues to increase while price rises, a move towards $50 could be in the offing. However, increasing volume with decreasing prices or vice versa will be evidence of decreasing demand. In this case, the bullish prediction may be cancelled.
Closing
AVAX's recent price increase can be attributed to several factors, including improved market sentiment, increased development activity, and new product launches. However, it is important to note that the crypto market is highly volatile and the price of AVAX can change significantly in a short period of time. Therefore, investors should always be careful and do their own research before making an investment decision .
⚠️Disclaimer
This content aims to enrich readers with information. Always conduct independent research and use discretionary funds before investing. All buying, selling, and crypto asset investment activities are the responsibility of the reader.