AVAX Showdown Builds as Bulls and Bears Battle for the Next Break

Source: CryptoNewsNet Original Title: AVAX Showdown Builds as Bulls and Bears Battle for the Next Break Original Link:

Market Overview

Avalanche’s AVAX token is moving into a decisive stretch as opposing forces fight for control of its short-term direction. As of press time, the token trades near $12.93 after a slight 0.14% gain, but the broader picture shows deeper strain. Its $5.54 billion market value inched up by just 0.13-0.14%, underscoring a quiet session marked by caution rather than conviction.

Even with that stability, AVAX still posts a 7% weekly drop and a 31% decline for the month, placing the focus squarely on whether the market is nearing a break or slipping toward another leg lower. The latest charts show the token’s price pressing against a zone where buyers have repeatedly intervened, turning this area into the central battleground for both sides.

Bulls Lean on Support Strength, Oversold Signals, and Exchange Outflows

Recent price action shows AVAX reacting strongly to the support area between $12.86 and $12.54. This area has become an anchor for buyers seeking to halt the downtrend. The chart also shows a double-bottom pattern, a formation that traders often watch for potential shifts in direction whenever a strong follow-up move supports the price.

Momentum readings give bulls another argument. The Relative Strength Index is embedded in the oversold band, a zone that signals when sellers are exhausted. Such conditions have previously aligned with short-term rebounds, making traders attentive to any early signs of strength.

Another factor bolstering the bullish side is a meaningful shift in exchange flows. Over the past four days, more than $13 million worth of AVAX has left exchanges. Funds moving off trading platforms and into private wallets usually indicate accumulation rather than distribution.

This particular activity may be interpreted as a sign of long-term players’ selective confidence amidst the price downtrend. Fundamental developments add extra support. Bitwise has filed to launch a U.S. staking ETF aimed for Q1 2026, which could stake as much as 70% of its AVAX allocation.

At the same time, MAP Protocol expanded its cross-chain network to Avalanche on December 1, widening AVAX’s interoperability footprint and its role in multi-chain activity.

Bears Maintain Control as Key Averages and Open Interest Decline

Despite the arguments building on the bullish side, the price remains under a long list of technical ceilings. AVAX is trading below the 20-period MA and 50-period MA. Staying below these levels keeps momentum pointed down.

Another warning sign comes from the derivatives market. Open interest has fallen to $535 million, suggesting that traders are closing positions instead of opening new ones. Falling open interest often means fading conviction, and that tends to favor the prevailing trend, which, in AVAX’s case, is bearish.

For now, even the recent bounce looks more like a pause than a shift. These dynamics indicate that many traders prefer to stay defensive until the price reclaims key levels or shows signs of sustained strength.

What Traders Are Watching Next

With price pressed against support, the next move hinges on whether buyers can reclaim critical technical markers. The first step is that buyers must push AVAX above the 23.60% Fib at the $13.18 zone. Only then can they attempt the 20-period MA at $13.67, with the next targets sitting near the 50% Fib around $13.91 and the 78.60% Fib at $14.69.

On the other hand, market analyst Ali outlined a right-angled ascending broadening wedge that recently broke to the downside, a structure known for producing extended declines. Under that pattern, price could drift toward the $9 area if current support fails.

Overall, with both camps holding evidence to support their stance, the coming sessions may determine whether AVAX can reverse its month-long slide or whether the downtrend resumes with renewed force.