Essentially, strategic investors could interpret is as major bullish signal when funding rate declines during a price rally, for a number of reasons.

Firstly, dropping funding rates may reflect improving market efficiency or decreasing market volatility. In such cases, traders may perceive the market as more stable and less risky, leading to increased buying interest and bullish sentiment.

Secondly, this reduction in the cost of leverage can incentivize more traders to enter the market or increase their position sizes, leading to increased buying pressure and more upward price movement. It could also signal to new entrants that despite 55% price gains in the past week, Avalanche market is far from overheated.

If this scenario plays out as predicted, AVAX price could surge further toward $70 in the week ahead.

AVAX Price Prediction: $75 Could be the Next Target

Drawing inferences from the 89% decline in Avalanche funding rate amid a 55% rally, Avalanche (AVAX) price looks well-positioned for enter another leg-up toward $75 in the week ahead.

However, in the short-term, the bulls could face major initial resistance at the $65 territory. A decisive breakout above that level could trigger a major rally towards $75.