After double-digit gains in June, Axie Infinity (AXS) price fell to $5.80 after a failed attempt at the $6.50 resistance. Data across the series indicates that the bears are about to break the $5.80 support.
Axie Infinity performed fairly well in June as markets responded positively to what had just been completed AxieTH Global Battle Games tournament. However, the on-chain data indicates that the bears are now poised to seize the momentum.
Axie Infinity players miss out while playing
User activity across the Axie Infinity GameFi ecosystem has seen a sharp decline since the beginning of July. according to Emotion data, the AXS 400 attracted active addresses on July 1, but by the end of July 10, that percentage had dwindled by 21%, to 316.
Daily active headlines Evaluates changes in user activity by counting the daily number of unique wallet addresses executing transactions. When it drops significantly, it indicates that the underlying currency may have difficulty finding new demand.
If the user activity of Axie Infinity continues to decline, the bears may break the AXS price support level of $5.80 in the coming days.
AXS support weakens as investor demand declines
Moreover, waning investor demand for AXS confirms bearish expectations that it may struggle to defend the $5.80 price support.
Under the current situation, potential investors have placed bids for just 617,000 AXS tokens. Meanwhile, bears have accumulated active orders across major cryptocurrency exchanges to sell a whopping 694,000 tokens.
The above chart shows an oversupply in the market of more than 77,000 AXS tokens. When the supply of an asset exceeds the demand by a significant margin, it puts downward pressure on the price.
In conclusion, the dwindling user activity indicates that Axie Infinity is unlikely to attract enough demand to hold the $5.80 price support. Thus, AXS holders can expect more price fluctuations in the coming days.
AXS Price Prediction: Possible correction towards $5
Given the above factors, the bears are likely to force AXS to fall below the current price support at $5.80.
However, the bulls will offer some support around $5.50. In that area, 148,000 investors who bought 4 million AXS tokens at a minimum price of $5.57 could prevent a drop.
But if the bearish momentum consolidates as expected, AXS could eventually drop towards the next important support level at $4.90.
However, the bulls can go ahead if Axie Infinity price rebounds above $6. However, the 9,740 investors who bought 125.4 million AXS tokens at the lowest price of $6 could lead to a pullback.
But if the resistance level does not hold, AXS could reclaim $8 for the first time since April 2023.
In line with Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to providing accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult with a professional before making any financial decisions.