Connect with us
Active Currencies 12895
Market Cap $2,234,717,365,655.10
Bitcoin Share 49.45%
24h Market Cap Change $6.82

AVAX crosses above downtrend line – is a recovery sustainable

2min Read
AVAX crosses above downtrend line - is a recovery sustainable

Share this article



Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

  • AVAX recovered slightly above a key short-term downtrend line. 
  • The sentiment was positive, but AVAX faced a price rejection at press time. 

Avalanche’s [AVAX] recovery could be limited despite improved investors’ confidence. The asset recently dropped from a high of $22.8 to a low of $19.4, a 14% plunge. The drop happened after Bitcoin [BTC] temporarily lost the $23k zone. 


Is your portfolio green? Check out the AVAX Profit Calculator


Bulls launched an impressive recovery attempt, but their efforts seemed unsustainable, as suggested by technical indicators. 

AVAX faced price rejection at $21.04

Source: AVAX/USDT on TradingView

Bulls inflicted a bullish breaker after finding steady support at $19.50. The momentum saw AVAX break the resistance at $19.81 and a convincing cross above the downtrend line, which flipped the short-term market structure to bullish. 


However, the price rejection at $21.04 set the bulls back. AVAX could settle on the seven-period EMA of $20.52 or $20.40 support levels before returning to retest the 21.04 level. 

However, if BTC lost the $23k zone, AVAX bears could devalue the asset below $20.40 and 26-period EMA in the next few hours. The extended plunge would invalidate the bias described above. But the drop could settle at $19.81 or the downtrend line. 

The Relative Strength Index (RSI) and On Balance Volume (OBV) registered a downtick, indicating that bulls could be undermined in the short term. 

AVAX recorded improved investors’ confidence, but…

Source: Santiment

As per Santiment’s data, AVAX recorded improving investors’ confidence from 5 February, as evidenced by the flipping of weighted sentiment from negative to positive. Notably, the investors’ outlook could have been boosted by the rising development activity in the same period.

It showed that investors felt assured by the network’s prospects, which was also reflected in a surge in price.


Read Avalanche’s [AVAX] Price Prediction 2023-24


However, the Funding Rate was relatively flat in the same period. Despite being positive, the lack of more demand for the asset in the derivatives market could undermine the strong uptrend momentum needed to bypass the price rejection level at $21.04.  

Therefore, AVAX recovery momentum could be limited, and traders should watch for the price rejection level at $21.04 alongside BTC’s price action.


Share

Saman is a News Editor at AMBCrypto. Her background in History and English expanded on her knack for editing and presenting all sides of a story without bias. With a strong will to learn, Saman is always up for exploring unknown territory, and crypto, with its ever-changing landscape, offers just that.
Read the best crypto stories of the day in less than 5 minutes
Subscribe to get it daily in your inbox.
Please check the format of your first name and/or email address.

Thank you for subscribing to Unhashed.