AVAX’s 12% Rise Makes Nearly Half of Holders Profitable – Can AVAX Price Overcome Key Resistance Zones Ahead?
AVAX has broken out of a descending parallel channel that has persisted for several months.
AVAX price faces a crucial test as it approaches the key resistance zone of $29.
Avalanche [AVAX] has been a standout performer in the mid-week cryptocurrency market. AVAX’s price climbed to a three-week high of $26.52 earlier today, extending its overnight gains on September 18.
At press time, the altcoin is trading up 12% over the past 24 hours.
The rise in AVAX’s price coincides with a broader cryptocurrency market rally amid a clearly favorable macro environment.
The widespread optimism comes after the U.S. Federal Reserve cut interest rates by 50 basis points to 4.75%-5% on September 18.
The latest adjustment to the benchmark federal funds rate signals a shift in monetary policy aimed at curbing inflation and supporting economic growth.
The Fed's move was the first rate cut in four years and the third time policymakers have started a rate cut cycle with a 0.5% cut.
Although the outcome was expected, it still caused turmoil in the stock and cryptocurrency markets. Data from IntoTheBlock showed that the price increase of AVAX has made 49% of token holders profitable.
The Fed is expected to cut interest rates further in the final quarter, but views are mixed on the impact of a 50 basis point rate cut by the Fed on risk assets.
Some analysts believe that the latest adjustment can only bring a short-term boost to the cryptocurrency market.
Bullish signal for AVAX
Avalanche (AVAX) is poised for a strong rally. A “falling wedge” pattern has been spotted on AVAX’s price chart, which is often seen as a sign of a positive turnaround.
This pattern has been developing since March 2024, with the price of AVAX experiencing a series of lower highs and lower lows. However, recent price action has seen AVAX break above the upper line of the wedge, indicating a shift from a downtrend to an uptrend.
This breakout could cause AVAX’s value to rise by 183% to around $45.5. He compared it to AVAX’s strong performance in late 2023, when it posted significant gains in similar market conditions. Based on this analysis, AVAX could be preparing for another rally.
AVAX Approaching Key Resistance Level
The daily chart of AVAX/USDT on TradingView shows that the pair is trading above its 100-day simple moving average (SMA) at $25.23 and 50-day SMA at $22.82 at press time.
The mid-week price rally has seen AVAX break out of the descending channel that has been dictating price action since late May 2024.
However, AVAX faces strong resistance between $27.92 and $30.14, an area that has served as a significant barrier over the past three months.
Since this resistance level has been tested multiple times but has yet to be successfully breached, the range is considered a make or break zone.
A successful challenge of this area could open the doors for a northward move, with bullish speculators eyeing $33 as the next target.
AVAX’s relative strength index (RSI) is currently at 43.38, just below the neutral 50 level. This suggests that the market is leaning bullish but is not yet in overbought conditions, which means there could be room for growth.
End
Avalanche has performed well over the past year, with a return of about 210%. At the same time, AVAX’s share of the entire cryptocurrency market has risen from 0.50% to 0.92%, with demand increasing compared to other cryptocurrencies.
These technical indicators point to a possible breakout and rising market interest, and many investors are eager to see if AVAX can reach the $45 mark in the coming days.
