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Disclaimer: The findings of the next evaluation are the only real 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 yet one more 90%”- nameless crypto analyst on Twitter. It’s true that not a whole lot 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 effectively. Avalanche has fallen by practically 76% for the reason that begin of Might.
The humorous factor is that there’s nothing stopping the coin from shedding one other 40% in worth. Technical help ranges beneath $14.6 lie at $9.7 and $5.1. With Bitcoin barely holding on to the $20k mark, one other avalanche down the charts might be a probable situation.
AVAX- 1 Day Chart
Supply: AVAX/USDT on TradingView
As talked about earlier, AVAX has long-term horizontal help ranges at $14.67 and $9.69. The earlier help at $23.22 held for practically a month, however the promoting strain was far too acute. Even on decrease timeframes, a bullish bias was nowhere to be seen. The $20 and $18.8 ranges have been performing as short-term resistance ranges.
The downtrend of AVAX started in late March. A rally from the $66.6 help stage 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 stage as help.
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 point out robust 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 beneath a stage that it had held on to since February. The falling OBV recommended that promoting quantity was excessive, and the downtrend may proceed except the OBV can climb greater. The CMF has additionally been beneath -0.05 since April, with occasional forays to the zero mark. This signaled heavy capital movement out of the market.
Conclusion
Taken collectively, the symptoms confirmed robust bearish momentum and promoting strain. A pullback towards $20 or $28 was not but signaled. The market construction remained bearish as effectively. Therefore, a session shut beneath $14.6 may provide a shorting alternative for Avalanche. On the identical time, a transfer to $20, mixed with a hidden bearish divergence, may additionally provide shorting alternatives.
