Key takeaways
Will AVAX Price Crash Soon?
Altcoin price action revealed that AVAX has been floating within a descending channel pattern on the four-hour chart.
What are AVAX traders doing?
At the time of writing, AVAX traders appeared to be overleveraged at $16.79 on the downside and $17.65 on the upside.
The current Avalanche (AVAX) price momentum has shifted market sentiment to the bearish side, hinting that a major drop could soon be on the horizon. In fact, according to on-chain data sets from Coinglass and CryptoQuant, this bearish outlook has strengthened even further of late. Especially since traders have been aggressively shorting positions.
A bearish signal for AVAX?
AVAX traders identified two key levels where they are overleveraged, holding strong liquidation zones: $16.79 on the lower side and $17.65 on the higher side. Both are levels where significant trading interest has been recorded so far.
At these levels, traders placed $1.07 million in long positions and $4.15 million in short positions, indicating strong seller dominance while confirming a bearish signal for the altcoin.
Source: Coinglass
However, that’s not all, as CryptoQuant’s Futures Taker CVD data can be used to assess whether buyers or sellers are dominating the market.
According to the same, AVAX has been dominated by sell orders from buyers over the past week, a sign that traders have been aggressively shorting the asset, believing that AVAX is unlikely to rally north any time soon.
Source: CryptoQuant
Combining these on-chain metrics with derivatives data, it would appear that AVAX may be under the control of the bears. This would also raise the question of whether it is the ideal time to dump AVAX or create new short positions.
At press time, AVAX was down 2.85% on the charts, and the altcoin was trading at $17.20. Market share also fell significantly, with its trading volume falling to $387 million.
Price action and technical analysis.
Finally, AMBCrypto technical analysis on the four-hour chart revealed that AVAX has been moving within a descending channel pattern since October 2025, fluctuating between its upper and lower boundaries.
However, after a recent recovery, the price reached the upper limit, a level where it has since faced selling pressure and formed a bearish candlestick pattern.
Source: Commercial View
If AVAX continues to fall and stays below the $18 level, it could see a further 18% drop, potentially reaching its next support at $14. It could go down further if the bearish momentum persists.
The bearish outlook for AVAX will remain valid as long as the asset remains below the $18 level. Otherwise, it may be invalidated.
Despite the bearish analysis, technical indicators showed some bullish signals on the four-hour chart at press time. The Supertrend indicator, for example, suggested that AVAX was flashing green as the altcoin maintained an uptrend.
Similarly, the average directional index (ADX) had a reading of 20.35, below the key threshold of 25, indicative that the asset has weak directional momentum.
