Axie Infinity (AXS) recently experienced a notable price surge, climbing 10% over the weekend, largely driven by a substantial increase in trading volume on major South Korean exchanges. While this uplift caught the attention of traders, an analysis of market indicators and price action suggests that the rally may be short-lived, with underlying bearish sentiments likely to dictate its near-term trajectory.
Surging Volume Fuels a Brief AXS Rally
On Sunday, August 31, Axie Infinity (AXS) witnessed an extraordinary spike in daily trading volume, reaching an impressive $423 million. This figure represents an almost 15-fold increase from the previous week's average volume of around $30 million. This surge was not isolated to AXS but mirrored a broader increase in trading activity for popular altcoins like Ethereum (ETH) and XRP on South Korean platforms such as Upbit and Bithumb. The intensified buying pressure momentarily propelled AXS's price by 10%, closing the day at $2.52 after briefly touching $2.8 – a key mid-range resistance level.
Bearish Undercurrents Suggest Limited Upside
Despite the impressive surge in trading volume and the immediate price gain, several indicators point to a challenging path ahead for AXS. The rally's attempt to breach the $2.8 resistance was met with strong selling pressure, forcing buyers to retreat and signaling bear dominance. The Accumulation/Distribution (A/D) indicator has consistently slumped in recent days, further underscoring seller control even amidst the Sunday buying frenzy. Although the Awesome Oscillator did show a bullish crossover, traders are advised to approach this signal with caution. Key resistance levels stand at $2.51, $2.65, and $2.77, which AXS would need to overcome with sustained bullish conviction, a difficult feat in the current market-wide bearish environment. Furthermore, while a short-term liquidity cluster sits around $2.4, the more significant magnetic zone for potential demand is identified between $2.1 and $2.2, suggesting a likely trend towards this lower support in the coming days.
