Grayscale’s ‘first multi-crypto asset ETP’ in the works: Will BTC, ETH win?
- Avalanche prices are expected to continue to tumble.
- The higher timeframes showed the bulls were stronger.
Avalanche [AVAX] saw a bearish market structure shift after the recent drop below the $38.38 level. This came after the 60% rally that AVAX went on from 23rd January to 15th February.
The rejection meant that AVAX prices could fall another 20%.
A recent AMBCrypto analysis noted that the $43.85 level was a key resistance. This has proved to be the case in the past ten days. Will the token fall below $30, or can the bulls initiate a recovery before that?
Using the Fibonacci levels to plot a course for AVAX
Source: AVAX/USDT on TradingView
The drop from $49.96 to $27.24 that took place in December and January was used to plot a set of Fibonacci retracement levels (pale yellow).
It must be remembered that this came after a huge rally from $8.65 that began in the second half of October.
Therefore, the pullback to $27.3 was a retracement on the higher timeframes and not a downtrend.
However, on the 12-hour chart, the two bearish order blocks (red boxes) at $42.5 and $48.5 were important resistances. The $42.5 zone has rebuffed bullish efforts for the second time in 2024.
Combined with the bearish market structure (highlighted in white) a drop to the bullish order block at $27.24-$30.2 was anticipated.
In January, a trendline breakout (blue) suggested that the bulls were about to embark on a rally past the $50 level. Instead, AVAX appeared to develop a $43 and $28 levels.
The Open Interest was in decline
Source: Coinglass
In mid-February, the Open Interest swelled well above the January highs as prices advanced past the $40 mark. However, this capital inflow was not enough to breach the resistance.
The price chart showed the OBV also trended higher in February, highlighting strong buying pressure.
How much are 1,10,100 AVAXs worth today?
The fact that the bears were able to thwart the buyers over the past two months reinforced the idea that a retracement below the $30 level was likely.
This would present a good buying opportunity, given the higher timeframe uptrend. On the other hand, a fall below the $24.5 level would mean that AVAX was headed toward $18 – a possible consolidation phase.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
