Avalanche vs. Solana Battle: Will AVAX Price Breakout to $60 After Consolidation Phase?

Key Insights:

• Avalanche (AVAX) price put up a strong showing last week, hitting a peak of $49 on Friday, before a 10% correction on Saturday.
• On-chain data shows that AVAX investors staked more coins on Saturday rather than panic sell in reaction to the price correction. 
• Historical accumulation trends highlight that AVAX bulls could regroup for another instant attempt at the $50 resistance. 

Avalanche (AVAX) price put up another strong showing last week, hitting a peak of $49 on Friday, but the 10% rejection to a daily timeframe low of $44 on Saturday raises concerns. On-chain data analysis highlights changes in AVAX staking dynamics amid the current price consolidation phase.

Will Avalanche bulls make an instant rebound and push to reclaim the $50 territory in the week ahead? 

Solana is Gaining Media Plaudits, But Avalanche Has the Upper Hand

Avalanche (AVAX) has emerged the best performing Layer-1 altcoin among the 20 top-ranked assets since the crypto market rally began in mid-October. 

Interestingly, Solana (SOL) appears to have garnered more attention, with it BONK memecoin and the Saga phone drama that has unfolded in recent weeks. 

 Solana drew plaudits for crossing the coveted $100 milestone and flipping XRP and BNB on Saturday. Meanwhile, Avalanche failed to cross $50, entering a sharp 10% rejection that saw it drop to a $44. 

Looking beyond the media headlines, Solana price has increased by 396% between Oct 18 to Dec 24. But this pales significantly compared to AVAX’s 462% price boost. 

However, despite SOL upstaging AVAX in recent days, a vital on-chain data metric suggests that Avalanche is not at risk of losing ground to Solana as 2023 draws to a close. 

Investors Staked 1 billion Worth of AVAX Tokens in the last 5 days

Avalanche price suffered a significant rejection from the $50 milestone on Friday, sparking concerns among bullish swing traders. However, on-chain data trends suggest that AVAX long-term investors and node validators remain steadfast. 

Firstly, the recent AVAX price upswing appears to have driven by the noticeable increase in Avalanche staking. 

Between Dec 19 and Dec 24, investors deposited a total of 21.07 million AVAX tokens into staking smart contracts.

According to StakingRewards, a prominent crypto staking data tracker, this brings to total staked AVAX to 268.26 million, the highest in the last 90 days.  

At press time on Dec 24, AVAX price is trading at $47. This means that the newly-staked 21 million Avalanche coins are worth approximately $990 million. 

An increase staking typically reduces the number of coins readily available to be traded on exchanges. Unsurprisingly, AVAX price has increased by 16% between Dec 19 and Dec 24, many thanks to the deflationary pressure triggered by the removal of nearly $1 billion worth of AVAX from the markets.

Notably, a closer look at the staking chart shows that rather than unstake and panic sell in the aftermath of the 10% rejection from $50 resistance on Saturday, the investors have actually staked an additional 440,000 AVAX ($21 million). 

Such an increase in staking during a price downturn is considered a bullish signal. It indicates that existing major stakeholders remain confident that the price downturn is temporary.  Hence, rather than sell, they opt to tide over the bearish headwinds, seeking passive income from staking. 

Importantly, historical trends in the staking chart affirm this stance, showing that periods of increased Avalanche staking have often been followed by an AVAX price uptrend. 

Based on the inferences from these historical on-chain data trends, rather than conceded ground to Solana, AVAX holders can anticipate an imminent rebound above the $50 resistance. And if that scenario plays out, a retest of the $60 territory could be on the cards.