Avalanche Faces Resistance: Can AVAX Break Through $50 Barrier?

Avalanche patners with Citibank

  • Technical analysis of AVAX suggests a bearish sentiment, with the price dipping below key moving averages and exhibiting bearish signals on indicators like MACD and RSI.
  • After the recent AVAX price fall, the key resistance levels are at $39.95, $50.80, and $59.99 respectively.

After a strong run-up earlier this year, Avalanche’s native cryptocurrency AVAX has been facing strong selling pressure over the past week trading 23% down. However, the recent bounce back in the broader crypto market has helped to abate the decline further. In the last 24 hours, the Avalanche (AVAX) price is trading 7% up at a price of $37.91 but still over a 35% discount from its 2024 high of $60.

Analyzing the 4-hour chart, AVAX has dipped below both the 100-day moving average and the trend line, indicating a potential downward trajectory in price. The MACD indicator, also on the 4-hour timeframe, reflects a strong bearish sentiment, with the MACD histograms trending below the zero line, along with both the MACD line and a signal line.

Moreover, the Relative Strength Index (RSI) on the 4-hour timeframe signals a bearish trend, as the RSI signal line hovers around the oversold zone. Despite the possibility of a short-term retracement, the prevailing indicators suggest a continued downward movement in price.

The alligator indicator serves as a potent tool for gauging asset trends. In the depicted chart, both the alligator’s lip and teeth have crossed below the alligator’s jaw, indicating a downward trend. This configuration implies a bearish outlook, signaling the potential for further price decline.

Avalanche (AVAX) Price Action Ahead

Analyzing Avalanche’s price action reveals two significant resistance levels at $50 and $59.99, along with a support level at $39.95. With Avalanche currently trending downward, breaching the $39.95 support level could precipitate a further decline towards the subsequent low at $27.53.

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Conversely, if the price holds above its previous low, it may initiate an upward correction towards the $50.80 resistance level. Should it surpass this level, AVAX could extend its rally towards the $59.99 resistance level.

At the time of reporting, Avalanche is trading around $38, marking a 1.75% decline over the last 24 hours. Its market capitalization has decreased by over 16%, while trading volume has surged by nearly 250% within the same period.

The Avalanche Ecosystem Growth

To begin with, the Core Wallet stands out as an exceptional native chain wallet, boasting superior speed and cost-effectiveness compared to Metamask for Avalanche transactions. Additionally, it extends support for Bitcoin, including Avalanche bridged BTC.b, along with a host of other impressive features.

Avalanche’s architecture comprises three distinct chains, a detail often overlooked by users. These include the X-Chain tailored for exchanges, the P-Chain serving as the platform chain utilized by most subnets, and the C-Chain, an EVM-compatible chain facilitating connectivity with the broader EVM ecosystem. Notably, the launch of new subnets does not encroach upon the C-Chain’s capacity or impede EVM transactions, ensuring seamless operation, per the Crypto News Flash report.

Subnets are emerging as a pivotal feature for Avalanche, offering a notable advantage, particularly for gaming and real-world asset (RWA) chains. Leveraging subnets provides developers with the robust security of Avalanche, enabling them to concentrate on enhancing the protocol, thereby encapsulating the essence of modular blockchain innovation.

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