Axie Infinity (AXS) shows signs of recovery as retail demand returns.

Axie Infinity (AXS) starts the new week with positive momentum as the price has increased nearly 25% as of Monday, indicating that capital flow and interest in this gaming token are gradually returning. The upward momentum emerged after the bonded AXS (bAXS) token airdrop program was completed on Thursday — a factor that was previously not fully reflected due to the overall market correction. Notably, trading volume and open interest (OI) in the AXS futures market both surged significantly on Tuesday, reflecting a clear improvement in retail demand, thereby reinforcing short-term positive prospects.

Axie Infinity’s bAXS Plan to Reduce Selling Pressure from Rewards

The first airdrop, totaling 100,000 bAXS tokens, was officially completed on Thursday, based on players’ Axie Score and holding conditions of over 10 AXS staking. The launch of bAXS aims to limit immediate selling pressure from ecosystem rewards and gameplay activities.

Accordingly, bAXS is a non-transferable bonded token version between players, applying a flexible sell fee mechanism. The fees generated will be transferred to the treasury, helping to maintain and regenerate circulating value across the entire ecosystem. In the near future, rewards from the ecosystem and in-game activities are expected to continue being distributed in the form of bAXS, addressing internal economic issues within the game.

Retail Demand Returns

Data from CoinGlass shows that the open interest (OI) of AXS futures contracts surged about 55% within 24 hours, reaching $99.54 million, reflecting new capital influx as traders bet on continued price increases.

Meanwhile, a wave of short position liquidations recorded $711,540, more than twice the $327,920 in long positions. This movement indicates that bearish traders are being heavily liquidated, contributing to short-term upward momentum.

Derivatives data for AXS | Source: CoinGlass On-chain indicators also confirm that user demand is gradually warming up, along with the re-emergence of retail capital. According to Santiment, the number of active addresses increased to 410 on Tuesday, up from 321 the previous day.

Notably, trading volume on Tuesday soared to over 181 million AXS, far exceeding the 36.67 million AXS of the previous day. Typically, a liquidity surge combined with a price rebound enhances the likelihood of a sustained short-term rally.

AXS volume and active addresses | Source: Santiment## Technical Outlook: Will AXS’s Uptrend Continue?

At the time of writing, Axie Infinity (AXS) remains above the $1.50 level, recording a nearly 25% recovery after dropping over 50% since January 28. However, the overall trend has not yet improved significantly, as AXS continues to trade below both the 50-day and 200-day exponential moving averages (EMA), indicating ongoing selling pressure.

In a positive scenario, if AXS can decisively break above the 50-day EMA around $1.55, the recovery could extend, with the next target being the 200-day EMA near $1.79.

Daily AXS/USDT Chart | Source: TradingView Regarding momentum, the daily MACD indicator shows signs of stalling after crossing below zero on Friday, while the histogram bars are gradually shrinking, indicating weakening downward momentum. At the same time, the RSI has risen to 47 and is approaching the neutral zone, reflecting decreasing selling pressure.

Conversely, if the 50-day EMA continues to act as a strong resistance zone and halts the current rebound, AXS could face the risk of losing the 50% Fibonacci retracement level at $1.42 — determined from the May 14 high of $3.70 down to the October 10 low of $0.55.