Disclaimer: The findings of the next evaluation are the only opinions of the author and shouldn’t be thought of funding recommendation.
“Even after your favourite coin drops 90%, there’s nothing that stops it from falling by one more 90%”- nameless crypto analyst on Twitter. It’s true that not lots of religion needs to be put into issues stated on Twitter, particularly by nameless accounts. But, this adage has been true within the 2018 bear market, and can possible be true on this cycle as properly. Avalanche has fallen by practically 76% because the begin of Might.
The humorous factor is that there’s nothing stopping the coin from shedding one other 40% in worth. Technical assist ranges under $14.6 lie at $9.7 and $5.1. With Bitcoin barely holding on to the $20k mark, one other avalanche down the charts may very well be a probable situation.
AVAX- 1 Day Chart
Supply: AVAX/USDT on TradingView
As talked about earlier, AVAX has long-term horizontal assist ranges at $14.67 and $9.69. The earlier assist at $23.22 held for practically a month, however the promoting stress was far too acute. Even on decrease timeframes, a bullish bias was nowhere to be seen. The $20 and $18.8 ranges had been appearing as short-term resistance ranges.
The downtrend of AVAX started in late March. A rally from the $66.6 assist degree took AVAX as excessive as $103.2. In April and Might, the sellers had management of the market, and AVAX has shed 84% since early April.
To flip the longer-term bias to bullish, AVAX would want to climb previous the $28 mark. In doing so, it might additionally want to carry on to the $23 degree as assist.
On shorter timeframes, a transfer previous $18.9 may flip the bias to bullish.
Rationale
Supply: AVAX/USDT on TradingView
The every day RSI stood at 30.2 to indicate sturdy bearish momentum. It has been unable to climb above the 40 mark for practically two months now. A bullish divergence was not current both.
The OBV additionally slipped under a degree that it had held on to since February. The falling OBV steered that promoting quantity was excessive, and the downtrend may proceed until the OBV can climb increased. The CMF has additionally been under -0.05 since April, with occasional forays to the zero mark. This signaled heavy capital move out of the market.
Conclusion
Taken collectively, the symptoms confirmed sturdy bearish momentum and promoting stress. A pullback towards $20 or $28 was not but signaled. The market construction remained bearish as properly. Therefore, a session shut under $14.6 may supply a shorting alternative for Avalanche. On the similar time, a transfer to $20, mixed with a hidden bearish divergence, may additionally supply shorting alternatives.
