- AVAX price shows a retracement after setting up a swing high at $25.83.
- The downswing will likely shed 8% before triggering the next move to $28.17 and $30.25.
- A daily candlestick close below $19.54 will invalidate the bullish thesis.
AVAX price shows an affinity to correct and shed weight after undergoing a massive expansive move in the last two weeks. This bullish development will be met with profit-taking that will likely drive the value of Avalanche lower.
But, the downswing will allow buyers to get in at a discounted price and ride the next leg of the uptrend.
AVAX price looks for stable footing
AVAX price inflated by 32% as it triggered a rally between July 27 and July 30. This move pushed the altcoin to produce a swing high at $25.83 from a swing low of $19.54. Due to this explosive and flashy move coupled with the bearish macro structure, market participants are booking profits, which is likely why Avalanche’s market value has dropped roughly 10% in the last five days.
While the short-term retracement might seem bearish for scalpers and day traders, it will be a good opportunity for sidelined investors. Going forward, AVAX price should retest the 62% or 70.5% retracement level at $21.93 and $21.40, respectively.
Such a pullback will be the best place to add more to one’s holdings, especially if the overall “recovery narrative” of the market remains intact. In such a case, this bullish retracement should result in the start of a next leg up that will likely push AVAX price to $25.83, which is the first hurdle.
However, if this level is overcome, then the obvious choice is to make a run for the $28.17 blockade, bringing the total move to a 41% ascent from the 62% retracement level at $21.93.
AVAX/USDT 4-hour chart
Although the overall outlook of this thesis is optimistic, investors should be prepared for a continuation of the retracement well past the 70.5% retracement level. A tell-tale sign of a bear infestation is if AVAX price fails to recover above the 79% retracement level at $20.86.
If AVAX price produces a daily candlestick close below the range low at $19.54, it will invalidate the bullish thesis by producing a lower low and breaching the one-month uptrend.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Bitcoin Weekly Forecast: Further upside likely after hitting new all-time high
Bitcoin (BTC) surged more than 10% this week, hitting a new high of $76,849 on Thursday, buoyed by the crypto-friendly candidate Donald Trump’s victory in the US presidential election.
Cardano breaks above descending trendline, eyes April high as bullish momentum builds
Cardano extends gains on Friday, following a close above a descending trendline the previous day. Technical indicators and on-chain data show bullish momentum, suggesting a rally ahead.
Top 3 Price Prediction: BTC touches new all-time high near $77,000 following Fed rate cut
Bitcoin price rallied and reached a new all-time high of $76,849 following the US Federal Reserve’s 25 basis point rate cut. Ethereum and Ripple followed suit and closed above their key resistance levels, hinting at a possible rally ahead.
Bitcoin, crypto market remain in uptrend following 25 bps Fed rate cut
Fed Chair Jerome Powell stated that the FOMC lowered the Fed funds rate by 25 basis points. The rate cut comes after Bitcoin reached a new all-time high price upon Donald Trump's election victory.
Bitcoin: Further upside likely after hitting new all-time high
Bitcoin (BTC) surged more than 10% this week, hitting a new high of $76,849 on Thursday, buoyed by the crypto-friendly candidate Donald Trump’s victory in the US presidential election.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.