Bitcoin (BTC) and most major altcoins are falling off overhead resistance levels, showing that sentiment
Avalanche (AVAX) has been trading in a range since the January 22 rally. It is currently trading right in the middle of this range.
Back in January, AVAX fell from its all-time high of $147 (November 2021) but continued to attract buying from strong support areas.
So far the downtrend has taken it as low as $52.95 on Jan 22nd. After that, the token recovered. While the exact location of the horizontal resistance area is unknown due to the presence of multiple wicks, it appears to be the $77.5 level (red symbol). Conversely, the next support area is $55.
Therefore, AVAX can be said to be trading in a range between $55 and $77.5.
AVAX/USDT weekly chart | Source: TradingView
The daily chart shows AVAX bouncing off the 0.618 Fib retracement support at $61.70. However, the recovery has been weak so far.
Furthermore, technical indicators have yet to confirm a bullish reversal. Although the MACD is rising, it has not yet entered positive territory. Similarly, the RSI is rising but has not crossed the 50 line yet.
Furthermore, AVAX has been trading along a descending resistance line since the all-time high mentioned above.
While a rally to this resistance seems likely, technical indicators have yet to confirm the possibility of the token breaking out.
AVAX/USDT daily chart | Source: TradingView
Short term movement
Trader @PostyXBT tweeted a chart from AVAX showing the token trading within a short-term ascending wedge. The wedge is considered a bearish pattern, so a break below it would be the most likely scenario.
The source: Twitter
Since the tweet, the token has broken below the wedge.
The first zone that could offer support is $61.40. This is the 0.618 Fib retracement support as a measure of the upside since Jan 22nd.
It is possible for AVAX to make a higher low at this level before attempting the long-term descending resistance line.
AVAX/USDT 2 hour chart | Source: TradingView
You can see AVAX prices here.
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Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
According to beincrypto