- AXL experienced a recovery of over 40% in October
- Nevertheless, the altcoin continues to encounter short-term challenges due to diminished market interest.
Axelar [AXL], a protocol facilitating cross-chain communication similar to Chainlink [LINK], surged by more than 40% in October, coinciding with a general market rebound.
This recovery brought AXL to a multi-month high, surpassing a prior Q2 support level that was below $1. So, the pressing question remains – Can AXL maintain its upward trajectory?
AXL’s Uptrend Analysis
Source: AXL/USDT, TradingView
Since late September, AXL has been trending upwards, forming higher highs and higher lows—a bullish market pattern ideal for long positions, pushing the price upward.
At the time of writing, AXL faced resistance at the Q2 support-turned-resistance level of $0.88.
Technical indicators suggest that the asset may be overbought, which could stall a strong continued recovery, especially if Bitcoin does not manage to break the $70k threshold shortly.
If AXL experiences a correction to the 38.2% Fibonacci retracement level, it may regain momentum for a breakthrough at the Q2 resistance level, providing a potential re-entry opportunity.
Conversely, if AXL successfully reclaims the Q2 support level, it may set the stage for a rise to $1.29. A bullish target of $1.12 would represent an additional potential gain of 20% if reached.
Whale Activity Declines
Source: Hyblock
Additionally, observations of declining whale activity further indicate the low probability of AXL surpassing the immediate resistance.
Since mid-October, whales have reduced their long positions, possibly contributing to the range-bound movement observed afterward. This trend was underscored by a declining Whale vs. Retail Delta.
An uptick in this metric, however, could enhance the prospects of AXL breaking through its former Q2 resistance level.
Read Axelar [AXL] Price Forecast 2024-2025
Moreover, the falling Open Interest (OI) figures are adding to the short-term challenges faced by AXL.
In mid-October, the OI was approximately $20 million, but it has since halved to around $10 million at the current time.
This decline reflects a nearly 50% reduction in market interest for the altcoin. Nonetheless, this dynamic may adjust if BTC recovers from recent losses and climbs above $70k.
Source: Coinglass
Disclaimer: The information provided does not serve as financial, investment, trading, or similar advice and reflects only the author’s perspective.
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