The cryptocurrency Avalanche (AVAX) has recently shown a distinct difference between spot market activities and derivatives market expectations. While the derivatives market shows a bearish trend with an increase in Open Interest (OI), AVAX continues to rise in the spot market. This makes AVAX’s future movements even more interesting.
Differences Between Spot and Derivatives Markets
Like many other altcoins, AVAX experienced a significant price drop recently but has entered a recovery phase. A closer look at AVAX shows that despite the price increase, investors remain cautious. The Long/Short ratio is at 0.88, meaning short positions outnumber long positions.
The Long/Short ratio reflects market expectations. Long positions are taken by investors expecting the price to rise, while short positions are held by those expecting the price to fall. A ratio below 1 indicates a bearish trend. This shows that investors are cautious about AVAX’s future movements.
Spot Market Dynamics for AVAX
Despite the bearish trend in the derivatives market, AVAX continues to rise in the spot market. According to recent data, AVAX has increased by 9.09% in the last 24 hours, trading at $27.44. This increase highlights the token’s recent volatility and investor interest. Cumulative Volume Delta (CVD) data also supports AVAX’s strong performance in the spot market.
A positive CVD indicates that the buying volume in the spot market is higher than the selling volume. This suggests high demand for AVAX and the potential for the price to continue rising. AVAX’s daily CVD is positive, indicating increased buying activity. If this trend continues, AVAX’s price could move towards the $30 level.
Open Interest and Investor Behavior
Open Interest (OI) in the AVAX market is also increasing. During the analysis, OI reached $267.12 million and was approaching $300 million. An increase in OI indicates growing investor interest and more capital entering the market. This could support AVAX’s price increase.
OI represents the total number of open contracts in the market and is an indicator of capital flow. An increase in OI shows that market participation is increasing and that investors’ interest in AVAX continues. If this trend continues, AVAX’s price could rise further, providing gains for investors.
AVAX’s market trends paint a complex picture with differences between the spot and derivatives markets. Despite bearish expectations in the derivatives market, strong buying pressure in the spot market and rising Open Interest suggest that AVAX’s price could continue to rise.
