At press time on Wednesday Avalanche (AVAX) was trading near $12, a decline of approximately 2% from the previous day. Grayscale filed an updated form with the US Securities and Exchange Commission (SEC) to convert its avalanche-focused trust into an exchange traded fund (ETF). Derivatives data suggests increased retail interest amid negative funding rates, pointing to a continued bearish trend.
Retail demand stumbles amid Grayscale’s updated AVAX ETF filing
Grayscale updated the sponsor details in the S-1 form it filed to convert the Avalanche Trust into an ETF to Grayscale Investments Sponsors LLC. However, the crypto asset manager has not disclosed any management or staking fees or discounts. The listing of this ETF on Nasdaq could boost institutional support for AVAX.
On the derivatives front, Avalanche is witnessing fresh capital inflows as futures open interest (OI) jumped 2.04% to $493.12 million in the last 24 hours. This indicates that traders are creating new positions, including long and short.
However, the negative funding rate of -0.0113% indicates that traders are willing to hold short positions by paying a premium.
Technical Viewpoint: Will AVAX Make a Comeback?
Avalanche is down more than 1% at press time on Wednesday, putting it at risk of breaking below the $12.00 level. An intraday pullback, extending nearly 2% losses from Tuesday, targets the S1 pivot point at $11.18.
A potential decline below this level could send AVAX down to $8.66, in line with the S2 pivot point.
The Relative Strength Index (RSI) on the daily chart stands at 38, which is still in the bearish zone amid renewed selling pressure. On the other hand, the Moving Average Convergence Divergence (MACD) shows a steady upward trend above its signal line, indicating underlying bullish momentum.
On the positive side, if AVAX rebounds from $11.18, it could target the overhead trendline connecting the October 29 and November 11 highs near $12.78.
