Layer 1 blockchains are having mixed fortunes in this crypto bull market. Where Bitcoin (BTC) and Solana (SOL) are powering higher, certain other blockchains are still in the doldrums. $ADA and $AVAX are two of these. Can they go higher?
How many layer 1s are needed?
One question on whether layer 1 blockchain networks can be viable, is “how many do we need?”. It can be argued that layer 1s can specialise in various niches, and therefore remain valid. However, layer 1s that were developed during the last crypto bull market, or even the one before that, will arguably have old tech, and therefore, the second question is: “will they be able to cut it for super fast and cheap transactions, and the required scalability and security for tomorrow’s technology requirements?”
$ADA breaks out, but no fireworks yet
Source: TradingView
The daily chart above shows that the $ADA price has pushed through the downward-sloping trend line. However, it hasn’t really taken off, and has come back to rest on a very long time support line, which goes all the way back to February 2021. A bounce here is needed, or the price could fall through and retest the trend line.
Source: TradingView
Assuming a bounce does take place from the current price of $0.42, near term targets, according to fibonacci levels, are $0.50, $0.62, and $0.70. Inspirational targets for $ADA would be $1.11, and $1.61.
$AVAX needs to bounce here
Source: TradingView
The $AVAX price may be a better proposition than $ADA, but this remains to be determined. $AVAX has also broken its downward trend and currently the price has settled back onto the $30 support. If this support can hold, the next major resistance at $39 awaits overhead. $25 is a base line support that $AVAX bulls will not want to see the price go below.
Source: TradingView
Looking at the macro weekly chart for $AVAX, it can be seen that the price has possibly started its upward journey, but that said, it still has quite some way to go. Getting above $39 is the absolute minimum requirement for $AVAX going forward. This would hopefully see the price build upon previous price structure, ready to launch back towards the previous highs.
Do $ADA and $AVAX have enough time?
Finally, the question might be asked, that if both $ADA and $AVAX are still down near the bottom of their respective price charts, and the bull market is arguably half way through, will they be able to get themselves back to their all-time highs? More improbable than possible?
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
