AVAX Breaks Key Resistance Amid Avalanche Ecosystem Upgrades: Is $40 Next?

AVAX Breaks Key Resistance Amid Avalanche Ecosystem Upgrades: Is $40 Next?

On September 20, AVAX surged past a critical resistance level that had kept its price in check for over two months. This breakout comes in the wake of significant advancements within the Avalanche network, fueled by the Avalanche Foundation’s announcement of a $40 million Retro9000 Grant Program. With this initiative and a major mainnet upgrade in progress, there is growing speculation: Could AVAX be on a path to reach $40? Rising developer activity and bullish market sentiment suggest that a substantial price rally may be on the horizon.

Avalanche’s $40M Retro9000 Grant Program Lifts AVAX Price

The Avalanche Foundation recently launched “Retro9000,” a $40 million grant program designed to support both testnet and mainnet developers working on the Avalanche network. As part of the largest upgrade since its mainnet launch, Avalanche9000, this grant aims to incentivize projects focused on Layer 1 blockchain development within the Avalanche ecosystem.

Recent data from DeFiLlama indicates that Avalanche’s total value locked (TVL) has been climbing alongside its price, reflecting increased capital flow into the ecosystem. Currently, Avalanche’s TVL sits at $1.043 billion, up 55% from its yearly low of $672 million on July 22. This rise in TVL signifies growing investor confidence and higher user participation, both of which can drive demand for AVAX and potentially lead to further price increases. A higher TVL can also signal improved liquidity, which could attract larger investors by facilitating sizable transactions without significantly impacting the market.

As of today, AVAX has risen 7% in the last 24 hours, reaching a price of $29.42.

Technical Outlook: AVAX on Track for $40 with Key Support Levels

From a technical standpoint, AVAX appears poised for further gains after surpassing its 200-day exponential moving average (EMA). The price has now established a new support level, buoyed by strong buying pressure around this zone.

This buying momentum could push AVAX even higher, potentially leading to a 36% increase to $40, a price last seen in May. Futures data from Coinglass backs this outlook, highlighting the significance of the current support levels. According to its Liquidation Map, AVAX’s support between the $25.98 and $28.73 range is backed by around $19.63 million in cumulative long positions across major exchanges like Binance, OKX, and Bybit, while short positions only total $10 million. This market imbalance suggests that traders expect AVAX’s price to continue rising.

However, should AVAX fail to hold above the 200-day EMA and drop below the neckline of its bullish double-bottom pattern, it could signal a reversal. In such a scenario, AVAX may find lower support at $20 or below.