Buying low and selling high is the cheapest investment strategy in the crypto space. However, American billionaire Charlie Munger once said: “Great profit is not in buying or selling, but in waiting.”

Perhaps AVAX investors can do just that now.

AVAX has entered the top 10 cryptocurrencies with the highest market capitalization. Despite the token price trending down after February 17, the altcoin has outperformed its peers.

What makes AVAX different?

Avalanche’s fast transaction speeds, low fees, and EVM compatibility have made it a popular alternative to Ethereum. In fact, the network has attracted a large number of users looking for projects with cheaper gas rates. Throughout 2021, Avalanche announced a number of significant upgrades and partnerships. The results were reflected in AVAX’s price action.

It should be noted that Binance and Coinbase have started supporting withdrawals and direct deposits from the exchange to C-Chain. This makes Avalanche very accessible for mid-range holders. It has also given the network a major advantage over EVM-compatible smart contract cryptocurrencies, which lack this support and require constant connectivity.

These positive factors have contributed to the AVAX price rising sharply. However, users are currently quite worried about the short-term price development.

AVAX has been trading in a range of $75.77 to $98.01 since the first week of February with an average of $85.92. After the sell-off on February 14, the token surged and hit a month-long resistance at $98. However, it has been in a downtrend ever since. Selling pressure has dominated the last three days. AVAX is currently trading around the $80.71 zone.

If the bulls prevail, the token will face resistance in the middle. Notably, a higher bottom could see the token retest the $75.77 support area. Short sellers can cause prices to fall. Currently, the RSI sits at 35 points and shows no signs of recovery. The MACD is also trending on the sell side.

AVAX Pricing Chart | Source: TradingView

Investment strategy AVAX

The market favors investors willing to sell short. However, at the macro level, there are opportunities for investors to go long. While many people disagree, the best strategy covers both bullish and bearish situations.

For AVAX, the bearish strategy looks promising in the near term. In the long run, however, a bullish strategy can be relied on. Given recent performance, it is important for investors to take profits at current prices. Failure to halt the loss at $75.77 could force them out of the market with no return.

On the macro side, on-chain indicators are quite positive for HODLers. The total value of assets blocked on the Avalanche Network (TVL) saw a sharp increase on January 28, 2022.

Right now, Avalanche has over 500 dapps and its DeFi protocols hold over $10.7 billion worth of TVL.

Total TVL on Avalanche Network | Source: Defillama

Looking at the activity of C-Chain, it can be seen that the number of daily transactions decreased on February 14th. However, there has been a slight increase over the last two days.

With a smaller time frame, you can see that the number of trades is trending upwards. This suggests that investors see more profit opportunities in the Avalanche network.

Number of Transactions | Source: avax.network

In addition, the number of monthly active addresses is also steadily increasing and is now above the October 2021 level.

Monthly Active Addresses | Source: avax.network

Given the development of DeFi, if market strength continues, AVAX is expected to break the ATH at $146.22 in the not too distant future.

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