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Following the announcement of the token buyback agreement between the Avalanche Foundation and Luna Foundation Guard (LFG), the price of AVAX surged by 10% within a few hours. This development pushed AVAX’s market value over $11.5 billion, bringing it closer to the $30 mark.
Avalanche’s Agreement with Luna Foundation
According to the latest announcement, the Avalanche Foundation has agreed to repurchase all AVAX tokens sold to Luna Foundation Guard in April 2022. However, this agreement is currently awaiting approval from the Bankruptcy Court. The news of the agreement sparked a significant price increase in AVAX, prompting market participants to take action.
In other words, the Avalanche Foundation announced its negotiations to retrieve all AVAX tokens sold to LFG in April 2022. This move aims to prevent LFG from breaching the original agreement.
Technical Indicators and Price Expectations
As of the time of publication, market data indicates that the AVAX price is trading at $28.49, marking a 9.33% increase. Technical analysis shows that AVAX has successfully emerged from a descending wedge pattern observed over the past few months. The Relative Strength Index (RSI) stands at approximately 49.8, while the Moving Average Convergence Divergence (MACD) signals positively at 0.19.
Market commentary indicates that AVAX is experiencing a breakout. Allegedly, Avalanche is displaying remarkable strength with the flawless formation of the wedge. A strong influx of capital at the end of the descending wedge pattern validates this expansion and has moved AVAX into a promising ascending channel.
Crypto analyst Crypto Winkle noted that if the upward trend continues, the AVAX price could surpass $30. Market analysts have also predicted that Avalanche could reach $50. Additionally, the preference for the Avalanche blockchain by traditional financial institutions stands out as another supportive factor for this rise.
The Avalanche Foundation’s repurchase of AVAX tokens from Luna is viewed as a crucial step in providing necessary infrastructure for the ecosystem’s growth and development. This development may enhance investor confidence and support future value increases for AVAX.
