- Avalanche so as to add the USP stablecoin into its listing of choices.
- The battle between AVAX bulls and bears intensifies as promote stress threatens to erase latest beneficial properties.
The crypto market simply concluded an attention-grabbing week marked by an extension of the bullish momentum at the beginning of this yr. Avalanche simply made issues extra pleasant after a significant announcement whereby it revealed that it’s going to host a brand new stablecoin.
Avalanche has formally confirmed that it’s going to assist the stablecoin USP created by Platypus DeFi. The latter beforehand confirmed that the stablecoin shall be in Avalanche’s fundamental pool which can play an essential position in USP’s stability. As well as, its collateralization mechanism will use different stablecoins.
🧐 How does the Adaptive Peg Stabilizer implementation keep $USP’s peg to 1 greenback? Let’s discover out on this thread!
USP #stablecoins shall be listed within the Primary Pool, and one of many main issue that have an effect on USP’s worth is its protection ratio within the stated pool. 🧵 pic.twitter.com/6W8r5TMP8f
— Platypus 🔺 (🦆+🦦+🦫) (@Platypusdefi) December 22, 2022
Much more attention-grabbing is the potential influence of the stablecoin on the demand for Avalanche’s native cryptocurrency AVAX. The stablecoin rollout will facilitate extra utility for the Avalanche community. A transfer that may seemingly gas extra demand for AVAX. The timing of the announcement can also be value noting notably on account of AVAX’s newest worth motion.
AVAX bulls wrestle with the 200-day Shifting Common
AVAX simply concluded a robust run-up for the second week in a row. It managed to climb by as a lot as 74% from its January low at $10. Nonetheless, it pulled again to a $17.05 press time, with promote stress manifesting after briefly crossing above the 200-day Shifting Common.
Whereas the 200-day MA could have acted as a psychological promote zone, it’s not the one indication of a possible pivot. The value additionally occurs to be in overbought territory, the place many traders are more likely to begin taking earnings.
Ought to we anticipate a significant pullback?
A robust selloff may be on the playing cards if AVAX holders, particularly whales begin offloading closely. This might set off a bearish cascade that may seemingly end in a large retracement.
Maybe a few of Avalanche’s metrics could assist paint a greater image of the potential end result. For instance, it simply skilled a significant quantity surge between 11 and 13 January.
This was the most important surge it has skilled within the final 4 weeks however the volumes have tapered off now. The quantity improve was preceded by an uptick within the weighed sentiment metric. The latter displays the large liquidity influx that entered into AVAX.
Reasonable or not, right here’s AVAX’s market cap in BTC’s phrases
The identical weighted sentiment metric has tanked, indicating one other sudden sentiment shift favoring the bears. Your complete time AVAX volatility was additionally up and so was the market cap reflecting the sturdy accumulation.
AVAX’s market cap did expertise a slight dip after the latest peak earlier than recovering. This can be a signal that there was some promoting stress on the prime.
The beforehand talked about quantity surge could have resulted from traders FOMOing in that has created sufficient liquidity to defend AVAX from extra worth slippage. Whether or not the identical will maintain will rely on whether or not the bulls can thrust back the bears.