According to a post on social media platform X (formerly Twitter) by Martinez, AVAX has formed a descending triangle pattern on the four-hour chart. The short timeframe of the chart indicates that the possibility of this playing out is very high in the near future. The descending triangle shown by Martinez in the chart below highlights the possible move for AVAX in the coming days.
Source: TradingView
Avalanche is poised for significant gains of 40% if the cryptocurrency breaks above the descending trendline that sits in the $37-$38 price region. However, if AVAX fails to break this trendline, a deeper analysis of the chart shows that a retest of the nearest support of $34.18 is likely. A drop below this support then opens the chances of a massive collapse to $29.17, $24.69, or even $22.18.
Meanwhile, CoinMarketCap data shows that the trading volume of Avalanche remains robust with a 52.69% increase in the past 24 hours. The altcoin’s volume stands at a substantial $499.79 million, while its market cap stands at $14.89 billion, ranked as the 12th-largest digital currency.
Avalanche (AVAX) Technical Analysis
Avalanche (AVAX) accumulation has been on the rise since November, but slight distribution was seen during late December and early January. However, since then levels have remained significant, and the gradient of the line suggests that a reverse could be on the horizon. However, to confirm a reversal, the volume needs to be higher than the levels in November.
Source: TradingView
The price action of Avalanche is situated in the lower end of the Bollinger Bands, which means that the bears are currently prevailing. A retest of the lower trendline is likely, and if it holds, investors could potentially see an attempt to break out above $37 in the coming days.
Source: TradingView
The Relative Strength Index (RSI) for the Avalanche price action reads a value of 44.03, which means that the selling pressure is much higher than the buying pressure for AVAX. Meanwhile, the gradient of the line suggests stagnancy in the altcoin’s price trajectory, suggesting uncertainty in the market.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
With a background in finance and a passion for innovation, Anisha has been covering the ever-evolving world of crypto for over four years. Her deep understanding of the crypto market have made her a trusted source for analysis and news. Whether it's dissecting the latest trends or decoding whitepapers, Anisha is dedicated to bringing clarity to the world of digital assets.