AVAX price premature rally could send the altcoin to $55 this week
|- AVAX price shows a recuperation of bullish momentum, hinting at another rally.
- Investors can expect Avalanche to head into the weekly resistance zone, extending from $51 to $56.
- A failure to produce a higher high above $49, coupled with a lower low below $37, will invalidate the bullish thesis.
Avalanche (AVAX) price is rising rapidly with renewed bullish momentum in 2024. This move comes after a sell-off on the last day of 2023. With sustained buying pressure, AVAX is likely to continue its ascent.
Read more: AVAX price could rally another 20% before it overheats
AVAX price initiates the next leg
AVAX price has increased 12% between January 1 and the current trading level of $43. This ascent comes in the first trading week of 2024 and likely has more legs to it due to the sell-off on December 31. This move collected the liquidity resting below the December 19 swing low of $38.
One of the common bull rally continuation identifiers seen in altcoins is a sweep of the previous low and production of a higher high. Hence, the recent rally seems to hint at more gains in the near future for Avalanche token holders.
Going forward, investors can expect AVAX price to enter a resistance zone extending from $51 to $56. This move, from the current level of $43 to $55 would constitute a 27% move.
Supporting this bullish thesis is a reset of the previously overbought Relative Strength Index (RSI) at the mean level of 50.
AVAX/USDT 1-day chart
While AVAX’s technical picture shows a restart of the bull rally, investors need to be careful if the token fails to post a higher high above $49. This move would be the first sign of weakness. If this development is coupled with a lower low below $37, it will invalidate the bullish thesis.
In such a case, AVAX price could fall back into the weekly imbalance, which extends from $31 to $22. This would imply a 16% fall from current price levels.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.