Axelar’s AXL token experienced a significant surge, with daily trading volume increasing by 1,200% and its price rallying 19.8% on Sunday, January 25. However, this move followed a broader market downturn triggered by Bitcoin’s decline below $88,000. Despite the weekend’s bullish momentum, technical analysis indicated the token’s overall structure remained bearish on higher timeframes.
The interoperability token Axelar [AXL] saw a dramatic 1,200% spike in daily trading volume alongside a 19.8% price rally on January 25. This surge occurred despite a wider market decline prompted by Bitcoin [BTC] falling below $88,000, which affected AXL’s lower timeframe momentum. On the daily chart, the market structure turned bearish after a drop on January 20, which confirmed a bearish continuation below $0.066.
During its recent rally to $0.083, AXL failed to close a daily session above a key overhead supply zone. The On-Balance Volume (OBV) indicator has reached new highs, surpassing even mid-December levels, while the daily RSI has recovered above the neutral 50 mark. Traders and investors have reason to be cautiously optimistic about a recovery.
However, the bearish bias remains intact on higher timeframes as the moving averages have not seen a crossover. On the hourly chart, the price threatened to fall below the 78.6% Fibonacci retracement level at $0.072. The hourly RSI slipped below the neutral 50 mark, and AXL traded below its 50-period moving average, signaling a potential bearish spell.
The huge Open Interest increase and swift weekend gains might not be sustainable. Analysts suggested a period of market retracement and consolidation may be needed before another bullish attempt. Over the next week or two, traders can watch for consolidation between $0.065 and $0.072 followed by a gradual recovery as a potential long entry signal. A price drop below $0.065 would warn of a bearish continuation.
