Avalanche (AVAX): Moving Past This Mark Might Shift Shorter Timeframe Bias to Bullish
Anonymous cryptocurrency analyst tweeted that your favorite crypto losing 90% does not stop it from dropping by an additional 90%. Indeed, investors should not trust Twitter posts, especially from anonymous users. However, this narrative happened during the 2018 market crash and can happen in this cycle. Avalanche is among the tokens enduring massive amid the ongoing price plunges. AVAX has dropped approximately 76% since May started.
Surprisingly, the alternative token has nothing to stop it from losing an additional 40%. Meanwhile, technical support floors beneath $14.6 stand at $9.7, then $5.1. Avalanche remains primed for further declines as Bitcoin shows weakness beneath the $20,000 mark.
AVAX 1 Day Timeframe
Avalanche boasts long-term horizontal footholds at $14.67, then $9.69. Meanwhile, the $23.22 previous support held for approximately one month before intensified selling momentum breached the mark. Surprisingly, the alt lacked a bullish outlook even on shorter timeframes. The value area at $20 and $18.8 acted as near-term resistance zones for AVAX.
Avalanche kick-started its downtrends late in March. Meanwhile, the token explored then $103.2 highs following upside rallies from the support floor at $66.6. Sellers dominated the markets in April-May, and Avalanche has lost about 84% since the early April sessions.
Avalanche requires a significant uptick beyond $28 to overturn the long-term outlook to bullish. Also, that would mean protecting the $23 mark as support. Meanwhile, a jump above $18.9 might flip Avalanche’s shorter timeframes bias to optimistic.
Reasoning
The daily Relative Strength Index hovered at 30.2, highlighting massive bearish strength. The indicator has failed to surge past 40 for about two months. Moreover, a bullish divergence wasn’t present. Also, the on-balance volume lost a crucial market that held since February.
The declining OBV highlighted escalated selling volume, and the downside might extend unless OBV surges high. Also, the Chaikin Money Flow stayed beneath -0.05 since April, presenting occasional forays towards the zero zone. That confirmed massive cash flowing out of the marketplace.
Final Thought
Avalanche indicators confirmed steady selling momentum and bearish strength. The altcoin is yet to signal a revival to $20 or above. Moreover, bears dominated the market structure. Thus, a session closing beneath $14.6 might present a shorting opportunity. Also, moving towards 20, plus a concealed bearish divergence might provide shorting opportunities.
Editorial credit: Ira Lichi / shutterstock.com
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