AVAX Pushes Toward $18 As Key Resistance Looms: Analyst

Overview

AVAX, the native token of the Avalanche protocol, is poised for a potential price breakout after experiencing significant mixed price action over the past week. Following a general uplift in the crypto market, AVAX initially rose to a high before retracing below a critical price level, indicating a pivotal moment for the altcoin’s future movement.

AVAX’s Current Price Action

Over the last week, AVAX reached a peak of $14.85 but subsequently fell back below the $13.50 mark. Analyst Ali Martinez has pointed out that AVAX is currently at a crucial price juncture, where the next movement could significantly influence its short-term trend. The recent price action indicates a struggle for AVAX to maintain momentum, particularly around the $14.83 resistance level.

Martinez’s analysis highlights that AVAX has encountered substantial resistance in the $14.83 region, having faced rejection three times in the last month. This repeated failure to break through this price barrier suggests that many investors view this level as an optimal point for profit-taking or anticipate a potential decline based on historical trends. The inability to surpass this resistance could hinder any bullish momentum in the near term.

Technical Analysis Insights

In his analysis, Martinez has noted the formation of an inverse head and shoulders pattern on AVAX’s 12-hour trading chart. This pattern is generally considered bullish and may indicate a potential trend reversal. The formation consists of three troughs: the left shoulder, where the price declines and then rebounds; the head, which represents a deeper decline to a specific price point followed by recovery; and the right shoulder, which forms a higher low that does not reach the depth of the head. The tops of the rebound highs are connected by a resistance line at $14.83, termed the neckline.

A decisive breakout above this neckline is crucial for AVAX, as it could signal strengthening buying pressure and a potential upward shift in price. According to the analysis, if AVAX can clear this resistance, it may target higher price levels, indicating a bullish outlook.

Market Overview

As of the latest updates, AVAX is trading at $13.61, reflecting minor losses of approximately 1.19% and 1.34% over the past one and seven days, respectively. However, the monthly chart shows a more positive trend with a reported market gain of 14.67%, suggesting that the market may be positioning itself for a trend reversal following a challenging performance in the previous quarter.

From author

The analysis of AVAX’s price action reveals critical insights into the altcoin’s potential trajectory. The current resistance level at $14.83 is pivotal, and how the market reacts to this barrier will be crucial for determining the short-term trend. The inverse head and shoulders pattern adds a layer of complexity, suggesting that while there are signs of bullish potential, the market remains cautious amid ongoing resistance.

Impact on the crypto market

• AVAX’s struggle at the $14.83 resistance level could impact investor sentiment across similar altcoins.
• A breakout above this level may trigger increased buying activity, influencing broader market trends.
• The formation of bullish patterns like the inverse head and shoulders can lead to heightened interest from traders and investors.
• The overall mixed price action reflects the volatility typical of the crypto market, which may affect trading strategies.
• A successful push past the resistance could enhance the perception of AVAX as a leading protocol in the DeFi space, potentially drawing more investors.