The price of Axie Infinity reveals an optimistic intent from a technical perspective, but on-chain stats provide warnings. There is one major hurdle that can make or break AXS and where it can lead. Therefore, investors should be careful with their investments in the coming days.
AXS’s price ready for a move?
AXS has come a long way since the head-and-shoulder pattern collapse on April 24. This technical setup features three distinctive peaks with swing-lows that reverberate at a steady support level known as ‘neckline’.
The central peak is the tallest and is called the “head”, while the peaks on either side of the head are known as “shoulders” and are of similar height. A breakdown of the “neckline” causes the downturn.
This setup is a popular reversal pattern and usually signals the distribution in the asset and represents the end of the uptrend. The goal is obtained by adding the distance between the top of the head and the neckline at the breakout point.
As AXS broke the neckline on April 24, the forecast reveals a 72% crash to $12.38. The price of Axie Infinity has crashed 63% in about 16 days and has hit a rocking low of $16.22. Since then, the altcoin has recovered 38% to where it traded at the time of writing – $22.29.
Given the state of Bitcoin and its bulls, an uptrend seems likely. Interested investors can therefore position themselves in the same direction for a nice profit. The first hurdle that AXS will face is $26.23. This barrier is an inflection point and can make or break the next leg.
A recovery above this level turning it into a support floor signals a rebound in buyers. Unfortunately, it is unlikely unless BTC goes on a full rally. A rejection could cause AXS to continue its downward trend towards its forecasted target of $12.38.
Given the bullish outlook on BTC, investors can expect the price of Axie Infinity to overcome the $26.23 hurdle and make a run for the next barrier at $45.22.
A bullish bias, but…
While the technical data definitely shows a bullish bias, on-chain volume says otherwise. A sudden rise in this index reveals that investors are interacting with the AXS blockchain. This could serve as a proxy for their investment thesis.
As can be seen from the technical data, a rise in this metric is often followed by an upward trend in the price of the asset. Therefore, in theory, investors could use this as a signal to jump into a trend early to squeeze out their profits.
However, for the price of AXS, this statistic was in a downtrend, showing that investors are not interested in the current price levels. In particular, the on-chain volume dropped from 1.05 billion to 342 million in the past five days.
This drop of 67% indicates a lack of optimism among investors. This is one reason why investors should be careful with AXS.
This post Axie Infinity [AXS] – Everything you need to know about the upcoming inflection point
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