Axie Infinity (AXS) price has tumbled below the crucial support level of $7. Although current demand is weak, on-chain data suggests an imminent recovery. Will AXS regain the $7 threshold in the coming days?
Following the price hike triggered by Apple AppStore listing on May 17, Axie Infinity (AXS) bears seem to have captured market control. AXS price has dropped by 18% from its recent high of $7.7 on May 17.
Despite the drop in price, new users are still joining the Axie Infinity GameFi ecosystem. With losses reaching alarming levels, can AXS holders trigger a price rebound if they stop selling?
Axie Infinity Continues to Attract New Users
The underlying on-chain data shows that the recent drop in price has not caused a significant deterioration in Axie Infinity’s network activity. The chart of Active Addresses (7d) below demonstrates that AXS has continued to attract new users this week. Between May 16 and May 23, it surged 73% from 823 to 1425 active addresses.
As seen above, the number of AXS active users has been increasing since May 17, when Apple announced the listing of the “Axie Infinity: Origins” strategy game on its native Appstore. New users are joining the Axie Infinity metaverse because they can download the AXS game on their iPhones and other 1.5 billion active Apple devices worldwide.
Investors Could Stop Selling Soon
The Market Value to Realized Value (MVRV) data shows that most Axie Infinity investors are holding substantial unrealized losses. The MVRV ratio evaluates the net financial position of investors by comparing their purchase prices to the asset’s current market value.
The Santiment chart below shows that with prices at $6.53, investors who bought AXS in the last 30 days are holding almost 9% unrealized losses.
With a net-loss position of 9%, most of the current Axie Infinity investors could become unwilling to sell at current prices. If they indeed stop selling as they desperately seek to keep their losses below 10%, they could inadvertently trigger another AXS price rally.
AXS Price Prediction: $7 is Still Attainable
If Axie Infinity gains enough bullish momentum as expected, it will face minimal resistance until it reaches $7.10. However, to be confident in the bullish Axie Infinity price prediction, it must first break above the $6.90 zone. At that point, sell pressure from 2,130 investors who bought 1.77 million AXS at an average price of $6.91 could trigger a pullback. If AXS can break through that resistance, it could rally as high as $7.31.
However, if its current downtrend reaches $6, the bears could invalidate the bullish AXS price prediction. But the potential buy-wall mounted by 347 investors who bought 19,700 AXS at an average price of $6.07 could prevent the drop. Axie Infinity could slide toward $5.51 if that support level does not hold, as these areas contain smaller pockets of buyers left.
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