Avalanche, a well-known altcoin, has recently experienced a significant downturn, plummeting by nearly 20% in the past few days. On a weekly basis, its market value has dropped by 10%. Although the daily chart shows a slight upward trend with a 1.6% increase, the technical outlook for Avalanche remains pessimistic.
Buyers are cautious about the price movement, while sellers are dominating the market, leading to a reduction in both demand and accumulation on the daily chart. In order for Avalanche's price to recover, it must surpass the $18 mark. However, the $17 price level has acted as a supply zone for the altcoin, and if bulls cannot defend the current price level, the bears may gain full control over the asset's price.
Like other major altcoins, significant market players have been struggling to break their crucial resistance levels, and the decrease in AVAX's market capitalization indicates a decline in buying pressure.
Avalanche Price Analysis: One-Day Chart
At the time of writing, AVAX was trading at $17.17, and the immediate resistance was at $18, which could lead to a push towards $19, strengthening the bulls if breached. However, if Avalanche continues to trade sideways, it is expected to fall below the $17 level, and the next support level for the asset is $15.
The altcoin's recovery relies on buyers stepping in and pushing its price above the $18 mark. The recent amount of AVAX traded is red, which suggests an increase in selling pressure in the market.
Technical Analysis
Over the past week, there has been a significant drop in demand for the altcoin, leading to a decline in its value. Although bullish investors are attempting to regain buying strength, it is necessary to surpass immediate resistance to make progress. The Relative Strength Index shows that sellers outnumber buyers, with the index below the 50-mark. Despite a minor upswing, the bearish influence continues to dominate.
Furthermore, the AVAX price remains below the 20-Simple Moving Average, indicating that sellers are gaining momentum and steering the market's price action. Additionally, further technical indicators suggest that bearish momentum is prevailing, as red histograms have formed on the Moving Average Convergence Divergence indicator, indicating sell signals on the one-day chart.
The Directional Movement Index determines the price direction, and currently, the -DI line (orange) is above the +DI line (blue), resulting in a negative DMI reading. The Average Directional Index (red) is above the 20-mark, indicating that the price momentum is gaining strength.
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Source: newsbtc
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Disclaimer
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.
