Avalanche: Should AVAX investors continue to play the waiting game
Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice.
Since back-pedaling from its April highs, Avalanche (AVAX) registered a substantial spike in the selling vigor. The liquidations from the $95-zone pulled AVAX below its six-month trendline resistance (white, dashed).
The current market dynamics exhibited a visible selling edge. So, the traders/investors must be wary before pacing long bets. As AVAX approaches the apex of the short symmetrical triangle (white), a lack of buying pressure could propel a short-term setback. At press time, AVAX traded at $24.87, up by 1.61% in the last 24 hours.
Source: TradingView, AVAX/USDT
AVAX was down by more than 85% of its value as it plunged towards its nine-month low on 27 May. Then, after bouncing back from the seven-month trendline support (yellow, dashed), the altcoin chalked out a short symmetrical triangle.
The recent bearish engulfing candlesticks noted more volumes than the buy orders and thus depicted a bearish edge.
After the 20 EMA (red) jumped below the 50 EMA (cyan), the gap between them kept rising over the last few days. This reading revealed a bearish edge in the ongoing market structure. Any close below the pattern and the $23-support could expose AVAX to a 10% downside in the $20-$21 range.
However, such an over-extended gap between the 20/50 EMA has historically provoked buying comebacks. For this, the buyers still needed to find a close above the six-month trendline resistance and the 20 EMA.
Source: TradingView, AVAX/USDT
The Relative Strength Index has been struggling to break above the 39-mark for over a month now. Its current readings blended well with the bearish outlook.
Although Aroon
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