AVAX’s Roadblocks Ahead of Fed Decision: What’s Next?

• AVAX attempted a recovery but faced key obstacles ahead of the Fed’s decision.
• Near-term bulls face two critical hurdles: open interest and negative funding rates declined.
• The May CPI report indicates that US inflation continues to cool, and it remains to be seen if the Fed will be influenced by the data.

AVAX Faces Challenges Ahead of Fed’s Decision

Attempted Recovery Faced Obstacles

AVAX attempted a recovery but hit a key resistance level in December 2022/early January 2023. Besides, more roadblocks ahead could delay a sharp upside move for the altcoin.

Bulls Face Two Critical Hurdles

Open interest and negative funding rates declined, making it difficult for bulls to make substantial gains in price. Moreover, the May CPI report indicates that US inflation continues to cool, raising questions about whether or not the Fed will pause rate hikes due to this data and other variables.

FVG Zones Create Resistance

Two FVG (fair value gap) zones exist at $11.7 – $13 (white) and $13.2 – $13.7 (red). These areas could cause resistance for AVAX prices should they try to cross above them on their rise higher. If there is a negative price reaction from these bearish zones, it could drag AVAX lower towards either $11.2 or $10 instead of moving up as expected.

Open Interest & Funding Rates Declined

The decline in open interest (OI) rates from >$60 million to below $40 million on Binance exchange speaks volumes about the current bearish sentiment surrounding AVAX futures markets trading activity – even though funding rates have eased slightly over the past few days, most exchanges are yet to record a positive rate for AVAX yet..

Positive BTC Movement Could Help Bulls

A positive BTC movement may help boost AVAX price should it break through its current resistance levels up to its range low of $13 .7 . Session close above this level would give bullish traders more confidence in targeting higher resistance levels at either $14 .5 or $15 .