Bears attempt to push Avalanche’s AVAX over a cliff for a 35% correction
- AVAX price faces a reaction from bearish divergence in its oscillators.
- Bulls may be waiting to enter at a powerful support zone that combines Fibonacci and Ichimoku levels.
- Retracements before the holiday season are normal.
AVAX price opened the week very strong with a new all-time high and after hitting the much sought-after $100 price level. Since hitting those two milestones, however, AVAX has plummeted more than 16% from the new high. Unfortunately for bulls, prices look like they will continue moving south.
AVAX price to extend losses a further 35% from the all-time high
AVAX price has consistently found support against the weekly Tenkan-Sen, currently at $76.50. Since first crossing above the weekly Tenkan-Sen in the week of August 13th, 2021, AVAX has never tested the Kijun-Sen. Given the current candlestick pattern developing, there is a real threat that the Tenkan-Sen will fail as a support level.
Market participants are likely looking at the $55 value area as the next primary support level for AVAX. This is because the weekly Kijun-Sen, 50% Fibonacci retracement and a high volume node in the 2021 volume profile all exist within the $55 price range. If AVAX price moves to $55, that would represent a 45% drop from the all-time high. That may sound like a lot, but the move is within the average percentage retracement range for altcoins.
AVAX/USDT Weekly Ichimoku Chart
Bulls and bears will want to monitor how AVAX price responds if it gets closer to the Tenkan-Sen. Any sustained and robust support at the Tenkan-Sen will invalidate any deeper bearish projections. If support holds at the Tenkan-Sen, then AVAX will likely continue its current trend of moving higher.
Author
Jonathan Morgan
Independent Analyst
Jonathan has been working as an Independent future, forex, and cryptocurrency trader and analyst for 8 years. He also has been writing for the past 5 years.
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