After reaching a new high of more than $65 on September 12, Avalanche (AVAX) appears poised to hit $80 in accordance with a classic technical pattern.

The structure, known as a “Bull Flag,” appears as a brief sideways/downward trend following a strong price move higher. As a result, Bull Flags resemble downward sloping channels with two parallel trendlines trapping the price action.

Furthermore, as prices fall, the market’s underlying trade volume decreases, indicating weakness in the downtrend. As a result, Bulls Flags usually resolve after a break above their upper trendlines, with prices pushing as high as the previous uptrend’s peak, i.e. Flagpole.

AVAX’s price action since August 17 has resulted in the formation of a Bull Flag pattern.

The chart above depicts the structure’s completion, from the $37-long uptrend (Flagpole) to the formation of a downward sloping channel to an upside breakout. As a result, the AVAX price appears to be aiming for $80.

This is primarily due to Bull Flags’ popular profit targets; analysts expect the price to break higher with length equal to the size of the flagpole. As a result, based on the breakout level ($45.64), the AVAX profit target is around $82.

The setup appears as the Avalanche token breaks another price record, reaching $66.47 for the first time in history, after a 618 percent rally from its July 20 low of $9.25. Meanwhile, its year-to-date (YTD) gains are an astonishing 1,988 percent.

DeFi and NFT are thriving in the shadow of soaring AV.

The Avalanche market rally closely followed similar moves in smart contracts tokens that compete with Ethereum, the leading public ledger behind the thriving decentralized finance (DeFi) and nonfungible token (NFT) space.

However, Ethereum’s dominance as a top smart contracts protocol has been called into question due to high transaction costs and network congestion. As a result, so-called “Ethereum killers” such as Solana (SOL), Cardano (ADA), Fantom (FTM), Avalanche, and others have found a home in the market.

According to DeFi Llama data, the total value locked (TVL) within the Solana ecosystem has increased by 165 percent in the previous seven days, while SOL/USD has increased by more than 42 percent in the same timeframe.

Similarly, Fantom’s TVL has increased by 12.73 percent, while FTM/USD exchange rates have increased by 39 percent in the last seven days. Avalanche’s TVL has increased by 0.5 percent, and AVAX/USD has increased by 41.10 percent.

In contrast, Ethereum’s TVL has fallen by 22.69 percent, indicating that liquidity is migrating to competing chains.

AVAX/USD began to rise, especially after the Avalanche Foundation launched its own DeFi incentive program on August 18. The organization has set aside $180 million for DeFi protocols that want to transition from Ethereum chains to Avalanche ones.

The foundation awarded $3 million to Benqi, a decentralized non-custodial liquidity market protocol built on Avalanche.

Avalanche has also seen an increase in the number of NFT and DeFi projects that want to run on its public ledger. Topps, a collectible and trading card company, used the Avalanche blockchain to launch its “2021 Topps Major League Baseball Inception NFT Collection.”

Despite this, Ethereum continues to be the dominant force in the smart contract space. The project is undergoing major network upgrades to address scalability and network fee issues, such as completely switching from proof-of-work to proof-of-stake by next year.