Axie Infinity (AXS) With an 8% Gain in the Last 24 Hours Despite the Crash
Axie Infinity (AXS) has been bearish ever since it hit an all-time high in the last quarter of 2022. The price has declined by around 90% ever since that. The downtrend may seem to continue in the coming weeks as well.
However, before jumping on the technical indicators, there are plenty of fundamental factors that have affected the price of AXS. First and foremost, the war between Russia and Ukraine has made all financial markets unstable. Nonetheless, some major cryptocurrencies, including the likes of BTC started recovering. While this correction was merely temporary and just a matter of days, most people still consider cryptocurrencies as assets rather than money. Hence, due to precautionary motives, people have a higher demand for fiat money at the moment.
Terra (LUNA) Creates Market Instability
To add salt to the wound, the recent market manipulation regarding Terra (LUNA) and UST has made the majority of crypto traders and investors panic sell. Terra was one of the biggest cryptocurrencies in the market and in the top 10 position based on market capitalization. Simply put, Terra’s stablecoin UST was shored up by BTC (billions of dollars worth of BTC) when LUNA hit its all-time high recently. Nonetheless, due to a failed agreement between Terra’s founder Do Kwon, and BlackRock and Citadel, UST’s liquidity drastically worsened. Both BlackRock and Citadel then dumped the amount of BTC they had borrowed from Gemini and the amount of UST they had purchased from Do Kwon (at a cheaper price).
This led to a break in the UST-USD peg, making the former go below $0.50. At the same time, BTC dropped below $29,000 for the first time in more than a year. Terra (LUNA), on the other hand, dropped by more than 99% within a day. Other stablecoins were beginning to depreciate in relation to the USD, which was unorthodox and fearful for every investor. This series of events led to a loss of faith in the entire crypto market. People were used to trusting stablecoins to at least have the function of a store of value. But, that seems not to be the case anymore since the algorithm behind UST failed drastically.
Axie Infinity (AXS) Technical Analysis
Axie Infinity, on the other hand, while still being on a bearish run, managed to increase in the last 24 hours by more than 8%. With that said, since the price is now slightly correcting, AXS has plenty of room for growth, other things being equal. The 20-day and 50-day MA lines are both above the price. The MACD line is below the signal line, meaning that the momentum is bearish.
Additionally, the relative strength index is now in the oversold region, indicating that a correction could occur. Since AXS was not that affected by the recent turn of events from the likes of Terra, we could see AXS maintain this independence from the current stablecoin instability in the crypto market.
The Fibonacci retracement levels of a 1-day chart suggest that if the price corrects, the 23.6% level could be a strong resistance level for AXS, given that the selling pressure is still quite high and that this level coincides with the upper trendline of the long-term chart.
Latest News for AXS – Price Factors
Besides these technical factors, we should look at other factors that could have an impact on the price of AXS. It is no surprise that Play-to-Earn games are no longer as hyped as they were in the last quarter of 2021. Still, Axie Infinity remains the best play-to-earn ecosystem in the crypto market. Both in community members as well as total market cap, Axie Infinity has been leading the line among its competitors.
Axie Infinity Origins recently launched as a mobile app, further increasing the utility and accessibility of AXS tokens. Hence, investors might be looking at similar utility coins during this time of crisis.
Here’s a look at the Axie Infinity Origins game that was recently launched for mobile.
Ahhh first win in @AxieInfinity Origin Android APK 🤝. Feels good to play on a tablet! pic.twitter.com/TpzIC1KYAb
— Chuck Fresco | Axie Infinity | Launch ORIGIN (@ChuckFresco) May 12, 2022
While everything remains bearish in the market, Axie Infinity (AXS) could remain the most enduring in the coming weeks of this financial market instability.