AVAX Price Drops Amid Altcoin Rotation and Technical Selling

Avalanche's (AVAX) price has dropped by approximately 3.5% over the last 9 hours, driven by a combination of factors rather than any negative news about the token itself.

The overall crypto market cap is slightly up, but sentiment remains in 'fear' with Bitcoin dominance slowly increasing. In this environment, it's no surprise that altcoins like AVAX are experiencing selling pressure.

One factor contributing to AVAX's decline is a Grayscale fund rebalance that cut the token's weight from over 2.1% to below 2.1%. This mechanical selling has generated direct sell flow and signals that institutional investors are de-emphasizing AVAX relative to other names.