Axie Infinity's AXS token has seen a 2.14% price decline over the past 24 hours, with the price decreasing from $4.96 yesterday to $4.86 today. This price drop comes despite a 24-hour trading volume of $17.72 million for AXS, indicating there is still significant interest in trading the token. However, buyers have not been able to push the price back up, resulting in the 2%+ loss.

Digging deeper into the price data, we can see the token is down 0.84% over the past hour and 1.26% over the past 7 days. The 1-month and 6-month percentage declines are more severe at 21.40% and 49.55% respectively. This shows the longer-term trend for AXS has been quite bearish, with the price steadily sliding lower over the past few months.

Currently, AXS has a market capitalization of $687.46 million, putting it within the top 50 cryptocurrencies by market cap. As a gaming/metaverse-focused crypto asset, AXS is still significantly smaller than sector leaders like The Sandbox and Decentraland. However, it maintains strong trading volume and a devout community backing its long-term roadmap.

Analyzing the varying percentage declines across different timeframes shows the AXS sell-off has accelerated in recent weeks. The 1-hour and 1-day drops are relatively minimal compared to the plunges seen over the past month and 6 months. This indicates shorter-term trader sentiment has turned more bearish on AXS as the long-term downtrend persists.

What's Behind the Ongoing AXS Price Slide?

The primary factor fueling AXS's protracted price decline is the weakness across both crypto and tech stocks this year. Both markets have been mired in bearish sentiment, with recession fears and rising interest rates weighing on riskier assets.

As a metaverse/gaming crypto directly tied to broader tech industry momentum, AXS has been unable to escape the selling pressure. Investors have moved away from high-growth, speculative assets as macro uncertainty increases. This has sunk AXS's price despite decent fundamentals.

Specific issues plaguing AXS in recent months include declining user activity on the Axie Infinity game itself. Due to the crypto market downturn, fewer new users have been purchasing AXS tokens and in-game NFT assets. This has lowered user numbers and in-game revenue, negatively impacting AXS price performance.

Competition within theplay-to-earn gaming niche has also increased substantially. Titles like STEPN have arrived on the scene and drawn users away from Axie Infinity. Faced with more rival games, Axie has struggled to sustain its once explosive user growth. This trend must reverse for AXS to regain its bullish momentum.

Will AXS Recover in 2023 After Its Recent Weakness?

Despite its lingering price depression, AXS could be primed for a significant reversal in 2023 if macro conditions improve. As crypto sentiment stabilizes and begins turning bullish again, speculative assets like AXS tend to lead the market higher quickly. Its swift price declines could easily transform into similarly rapid gains.

The most likely catalyst for an AXS recovery is a comeback in user activity and revenue for the Axie Infinity game itself. The developers have teased significant updates coming soon that could reinvigorate interest in playing Axie. If these updates are well-received, it would incentivize more gamers to purchase AXS tokens and boost trading volume.

The key to a sustainable AXS price recovery is increasing utility for the token and deepening its ties to the Axie gaming ecosystem. If the token becomes more integrated into gameplay and transactions, it will support higher value levels. The development team must focus on utility-boosting upgrades rather than superficial changes.

With Axie Infinity still positioned as a top player in blockchain gaming, AXS has the brand recognition necessary for a resurgence. As the macro climate improves in 2023 and beyond, AXS could quickly bounce back and retest its all-time highs. Patient holders would be well-rewarded if the development team plays their cards right.

How Can Traders Capitalize on AXS in This Bear Market?

With AXS still stuck in a firmly bearish long-term trend, what strategies should traders employ for the rest of 2022? Shorting rallies and neutral options strategies appear optimal in these conditions.

Selling into any overheated bounce in anticipation of lower lows is a wise tactic as long as the downtrend persists. Traders can also use put options to bet on further downside while limiting risk. Spread trades like bear call spreads or put debit spreads can define risk on short trades as well.

Patience is critical for longer-term investors. Trying to pick the bottom prematurely usually backfires. Allowing the technical picture to shift back to bullish could save holders from substantial losses over the next several months if macro weakness lingers.

Will Metaverse Tokens Regain Their Allure in 2023?

The much-hyped metaverse theme rapidly fell out of favor in 2022's risk-off environment. With AXS closely tied to metaverse and gaming trends, can this niche regain its mojo in 2023?

Much depends on the evolution of the macro backdrop. If economic turbulence persists, speculation will remain muted and limit upside for AXS. But if inflation settles and central banks turn dovish, metaverse tokens could become market darlings once again.

Their adoption trajectory will also hinge on development progress. If renamed metaverse projects like Axie Infinity make strong advances in usability and consumer appeal, interest will return. Right now the technology remains clunky. Smoothing out technical issues is pivotal.

2022's plunge should not negate metaverse tokens' long-term potential. But stronger execution and macro improvement are required to reenergize investor enthusiasm after a dismal year. The seeds have been planted for huge metaverse growth, but patience will be necessary.