Avalanche’s liquidations from its earlier symmetrical triangle saw the altcoin plummeting beneath its 8-month trend-line support – (previous resistance).
However, the overall market improvement saw bulls fixating a spot beyond the $21 mark. Also, the latest patterned breakdown might slow the short-term bullish momentum.
Buyers’ dedication to defending $21 might mean a low volatility period for AVAX before revival chances emerge. While publishing this content, AVAX hovered at $22.47, dropping approximately 14% over the past day.
Avalanche Daily Timeframe
Avalanche lost over 90% since hitting its all-time high, declining towards 10-month lows on June 19. Meanwhile, bulls reacted by reclaiming a position beyond the trend-line support. This comeback witnessed reversal actions from the range resistance at $30-$31.
The latest climbing wedge breakdown catalyzed surged in selling pressure as AVAX fell beneath its Exponential Moving Average ribbons. Buyers might watch out for bounce-back opportunities as the price action approaches the support at $20-$21.
Such scenarios would have potential targets around the $24 mark. Nevertheless, failure by buyers to join would bolster the present dullness. That translates to a possible squeeze for AVAX in the upcoming sessions.
A decisive closing beneath the support at $20 would trigger shorting opportunities, with targets at $16 – $18. Meanwhile, investors should analyze macroeconomic factors’ effect on market sentiment.
Reasoning
The Relative Strength Index dipped into bearish territory following a snap to the midline support. Moreover, the indicator appeared ready to enter the oversold level. Bulls still had a massive battle before switching the waves to their side.
Though the on-balance volume seemingly kept its support, any rebound might trigger a short-term bullish move. Traders should watch out for rebounds before executing calls.
Moreover, the MACD’s bearish cross confirmed the bearish momentum. However, the lines hadn’t plunged beneath the midline to highlight a 1-sided bearish superiority.
Final Thought
Buyers trust convincing reversal would emerge due to the nearest support at $20 – $21. However, bearish crosses on the Exponential Moving Average ribbons might catalyze sluggishness in the upcoming sessions. Targets would remain as discussed.
Moreover, investors should watch broad market sentiment to complement the highlighted technical factors.
