In today’s piece, we will be taking a look at AVAX – the token for the Avalanche network. At time of writing AVAX is trading around $19.50 and is ranked as the 17th largest crypto with a market cap of $5.7 billion. AVAX can be staked on the Midas platform to earn a passive income up to 13.3% APY.
The last time we looked at AVAX was earlier this month on August 3. We said:
AVAX looks weak on the 4H, indecisive on the daily, and moderately oversold on the weekly. If Alt season continues, we expect AVAX to move up and test higher resistance levels around $28. If AVAX fails to break the $26 level, however, we expect it to retrace to support levels, first at $23 and then $20.
This is exactly what has happened over the past few weeks! AVAX broke the $26 resistance and tested the $28 level a week later, which failed to break. After this, AVAX retraced to the $23 support level we identified, and is now sitting just below the $20 support level – just as we predicted.
So what’s next for AVAX? Let’s take a look at the charts and find out.
AVAX Price Analysis
After falling back to support levels, the 4H chart is not looking good for AVAX. Moving averages have completed a death cross pattern – confirming the bearish price action. The closest resistance level is at the 50SMA, priced at $21, followed by stronger resistance at $24 (4H 200 SMA).
AVAX is currently sitting at local support for just under $20. Beneath here, support could be found at the $16 level, which was a previous accumulation zone in June and July.
Our short term momentum indicators are giving us a bearish signal. The RSI failed to rise above neutral and is stalling, and the Stochastic is overbought – signaling a dump to reset momentum indicators is imminent.
The daily chart also has some bearish indications. AVAX fell beneath the daily 100 SMA, and then confirmed it as resistance last week, cementing this as a resistance zone at $22.
The good news for AVAX is that on the daily timeframe, momentum is oversold. This means a bounce in the medium term is likely to test the $22 resistance that we just mentioned.
Lastly, we will look at weekly momentum for a longer term view. Here the RSI has risen slightly from oversold levels, but the Stochastic is overbought, making it likely that we see a longer period of accumulation near the lows before any significant price recovery is possible.
AVAX looks bearish on the 4H, bullish on the daily, and neutral / slightly bearish on the weekly. This means that we will likely see some sort of dip in the coming days, a grind upward in the coming weeks, and consolidation in the months ahead. Key support is at the $16 zone, while key resistance is near $22.
Not investment advice. Do your own research.