AVAX’s price moved past $40, signaling an increase after confirming support in a long-standing horizontal zone. However, facing resistance at $40, if AVAX breaks out of this channel, it might decline towards the $33 support level.
On February 10th, Avalanche (AVAX) surpassed the $40 mark after a 20-day rally. During this surge, the price found support in a long-standing horizontal zone. However, it remains within a shorter-term resistance level despite the upward movement.
Analyzing the Technicals: Avalanche (AVAX) Outlook
Weekly Technicals: Since January 22, the price of AVAX has been on an upward trajectory, finding support in a horizontal area that previously acted as resistance since May 2022. Despite this climb, AVAX has yet to surpass its 2023 high. The weekly Relative Strength Index (RSI) presents a mixed picture, hovering above 50 but declining over the past two months, occasionally dipping below the overbought threshold without recovery.
AVAX/USD Weekly Chart. Source: TradingView
Daily Outlook: On the daily timeframe, AVAX’s future direction remains uncertain due to conflicting price action. The recent uptrend since January 22 has unfolded within an ascending parallel channel, typically containing corrective moves. Although the channel resistance at the $40 level rejected AVAX’s price on February 10, the daily RSI indicates a bullish trend, rising above 50.
AVAX/SOL via Coinmarketcap
Market Sentiment and Potential Scenarios
There’s speculation that AVAX’s price movement may mirror that of SOL, with potential follow-up if SOL experiences a surge. Reaction to the $40 level is crucial for AVAX’s trajectory. A successful breakout could propel the price by 23% towards the 2023 high at $50.
Conversely, a rejection at this level and a breakout from the channel could trigger a 16% decline towards the nearest support at $33. As of the latest update, AVAX is trading at $41.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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