Avalanche’s native token AVAX is testing a critical resistance level around $28.57. This price point represents a key level for AVAX as it attempts to break out of its recent consolidation phase.
AVAX’s next substantial move could be determined by a combination of bullish and bearish indications, according to a TradingView analysis of the daily chart.
AVAX Indicators Show Mixed Signals
AVAX’s price hovers around $26.83, just below the middle Bollinger Band, which suggests that the market is in a neutral phase with a possible bearish bias.
Bollinger Band contraction shows that the price is stabilizing after an advance from $20. It is crucial for traders to understand that the market could move in either way depending on whether AVAX can break above the middle Bollinger Band.
Source: TradingView
The line crossing over the signal line indicates that the MACD indicator formed a bullish signal. Little bullish pressure is shown by the histogram bars, which begs the question of whether the trend can continue.
Also the Relative Strength Index is at 63. 64 which is slightly higher than the neutral 50 but well below the overbought area. This positioning suggests there is room for upward movement, though caution is advised as AVAX approaches resistance levels.
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The chart highlights key Fibonacci retracement levels from the high of $65.34 to the low of $17.22. Currently, AVAX is testing the 0.236 Fibonacci retracement level at $28.57, a crucial resistance that has repeatedly held firm.
A successful breakout above this level could propel AVAX towards the next Fibonacci level at $35.60, with further gains possible up to $41.28. However, failure to breach this resistance may result in a retracement to the $20-$22 support zone.
Volume analysis indicates relatively low trading activity, raising concerns about the strength of a potential breakout. Typically, an increase in volume is necessary to confirm a move above a resistance level like $28.57.
Without this support, AVAX may struggle to sustain any upward momentum, making it vulnerable to a pullback.
Source: TradingView
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Potential Scenarios for AVAX
In a bullish scenario, if AVAX breaks and holds above the $28.57 resistance with increasing volume, it could initiate a rally toward the $35-$36 range, targeting $41 in the longer term.
The current MACD crossover and RSI levels support this outlook, but it hinges on sustained buying momentum. Conversely, a bearish scenario may unfold if AVAX fails to break above $28.57.
Furthermore, this might trigger a downturn, with first support at $24 and a stronger support zone between $20 and $22. Bulls are concerned about the dropping volume during the recent upswing, as it indicates a lack of belief in the price increase.
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The post Avalanche Price Analysis: Key Resistance at $28.57 as AVAX Bulls Eye Potential Breakout appeared first on CaptainAltcoin.
