Key Takeaways
- 74% Correction Completed: Avalanche (AVAX) shows signs of trend reversal after a significant pullback.
- Bullish Indicators Emerge: Oversold RSI and MACD golden cross suggest upward momentum.
- Critical Level at $21: Sustaining above this support confirms a new uptrend; a breakdown may signal further decline.
Avalanche Price Analysis
Avalanche (AVAX) peaked at $65 in March 2024 before undergoing a steep correction to $30 by mid-April. After 55 days of consolidation, the price broke out to $41 in late May but has since retraced. Technical analysis suggests the current downward phase may represent the final leg of this correction.
Wave Structure and Technical Signals
- ABC Correction Pattern: The August 5 low likely marked the end of the C wave in a broader ABC correction.
- Oversold Conditions: Daily RSI hit 25 (oversold) on August 5, coinciding with a MACD golden cross (August 17), indicating a potential trend reversal.
- Leading Diagonal Formation: The current five-wave pattern from August 5 may resolve as a leading diagonal, with wave four overlapping wave two—a common trait in diagonals.
AVAX Price Prediction: Scenarios and Key Levels
Bullish Case
- Uptrend Confirmation: A sustained move above $21 establishes a higher low, signaling a new bullish phase.
- Targets: A breakout above $30 could propel AVAX toward $41 (May high) and beyond.
Bearish Risk
- **Breakdown Below $21**: Failure to hold this support may lead to a retest of the August 5 low ($15–$18 range).
Chart: Nikola Lazic via TradingView
Market Sentiment and Strategic Moves
- Recent Rally: A 40% surge from September 6 ($20) to September 20 ($28.80) tested the 0.786 Fibonacci level.
- Next Steps: Watch for a possible minor higher high near $30 before a retracement. The depth of this pullback will determine the strength of the uptrend.
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FAQs
1. What triggers AVAX’s bullish momentum?
Oversold RSI readings, MACD crossovers, and completion of a 74% correction are primary catalysts.
2. How critical is the $21 support level?
It acts as a make-or-break zone: holding above it confirms bullish continuation; losing it risks further decline.
3. Can AVAX reach $30 again?
Yes, if bullish momentum persists and $21 support holds. A breakout above $30 may target $41 next.
4. What’s the long-term outlook for Avalanche?
A successful higher low above $21 could signal the start of a multi-month uptrend within a larger bull cycle.
5. How does the MACD indicator help?
A golden cross (MACD line above signal line) suggests growing buying pressure and potential trend reversal.
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Conclusion
Avalanche (AVAX) stands at a pivotal juncture. While bullish technicals hint at a reversal, the $21–$30 range will dictate short-term direction. Traders should monitor RSI, MACD, and volume trends for confirmation.
Disclaimer: This analysis is for informational purposes only and not financial advice. Cryptocurrency investments are volatile; conduct independent research before deciding.