AVAX is finally showing some sign of recovery after breaking the short-term support recently and nearly retesting the June low. A new Avalanche announcement could amplify its potential benefit by allowing more access to Bitcoin within the network.
Here is AMBCrypto’s price prediction for AVAX
Avalanche recently announced that users can now bridge Bitcoin in the network through the Core app. Access to Bitcoin, as well as its usefulness within the Avalanche ecosystem, was previously limited, mainly due to low DeFi activity and lack of smart contracts.
Bridge Bitcoin to Avalanche Using @coreappand unlock the possibilities with your BTC in the Avalanche DeFi ecosystem ✅ https://t.co/8S1vXWeQtw
— Avalanche 🔺 (@avalancheavax) October 17, 2022
Freeing up more liquidity for Avalanche
One of the main advantages of the new bridge is that it will usher in more liquidity in the form of Bitcoin. This means that Avalanche can be more useful if it overcomes the previous limitations.
Higher liquidity means more utility, which in turn can lead to higher speed and volatility for AVAX. These features are very useful for AVAX traders and investors.
Unfortunately, AVAX volatility has been trending downward for the past four weeks. This made it less attractive to traders hence a drop in volume.
An increase in more liquidity and network usage can increase AVAX’s long-term volatility. As far as the short-term outlook is concerned, AVAX could be at the beginning of a bullish relief.
The news of the new bridge enabling BTC transfer to the Avalanche network could boost investor sentiment and generate more upside.
Both weighted sentiment and social dominance measures have seen significant increases over the past 48 hours. This activity can be associated with the Bitcoin bridging news, and if so, the market reacted positively.
AVAX was trading at $16.10 at the time of writing, which was nearly an 11% increase from its lowest price point last week.
AVAX’s pivot occurred after retesting the June support levels, though it managed to reverse significantly above the 2022 low. The price surge also happened just before diving into the oversold territory of the RSI.
The bullish bounce at the 5-month support level confirms that investors in the same zone have bought back. Unfortunately, this also means investors are buying back near the observed bottom. However, it is too early to say whether AVAX is about to deliver a strong bullish short-term performance.
The crypto market has risen significantly since the beginning of this week and AVAX is one of the coins that has seen some advantage. General market conditions affect the ability to deliver a sustainable recovery.
This post Avalanche Unlocks More Liquidity Through Bitcoin, But Now What?
was published first on https://ambcrypto.com/avalanche-unlocks-more-liquidity-through-bitcoin-but-whats-next/