Home / Analysis / Crypto / Technical Analysis / Avalanche (AVAX) Near Key Support as Descending Triangle Signals Possible Breakout

Avalanche (AVAX) Near Key Support as Descending Triangle Signals Possible Breakout

Published
Nikola Lazic
Published
By Nikola Lazic
Edited by Ryan James

Key Takeaways

  • Descending wedge breakout signals bullish continuation potential.
  • Wave (5) could target $53-$55 Fibonacci resistance.
  • Invalidation occurs below $29, weakening the bullish case.

AVAX is currently positioned at a critical inflection point, consolidating within a descending wedge pattern on the daily chart.

A potential breakout could lead to a continuation of the larger Elliott Wave structure, suggesting further upside.

Meanwhile, the hourly chart hints at the early stages of a five-wave impulse formation, which, if confirmed, could drive AVAX toward key Fibonacci targets.

AVAX Price Analysis

On the daily chart, AVAX has been in a corrective phase, likely completing what appears to be Wave (4) of a larger impulsive structure within a descending triangle.

The price has found support around around $33, which aligns with the lower boundary of a descending wedge formation. This suggests a possible reversal zone as it corresponds with the 0.382 Fibonacci level. 

AVAX price analysis
AVAXUSD in a descending triangle | Credit: Nikola Lazic/TradingView

The prior price action shows that AVAX completed a full five-wave cycle to a peak of around $65 before undergoing a significant ABC correction. The downward retracement appears to have formed a bullish wedge, hinting at an upcoming move higher.

The Relative Strength Index (RSI) on the daily chart remains neutral, suggesting that momentum has yet to fully shift bullish.

However, a breakout from the descending wedge would likely trigger an upward wave (5), confirming the continuation of the larger bullish trend.

If AVAX breaks above the wedge resistance near $41, the next Fibonacci levels at $47 (0.618 retracement) and $55 (0.786 retracement) will become the primary targets.

AVAX Price Prediction

AVAX appears to be forming a five-wave impulsive structure from its recent low near $33 on Jan 27. The descending wedge pattern suggests that Wave (4) has likely completed, setting the stage for a breakout.

The first confirmation of this move will be a decisive push above $36-$37, marking the start of Wave (i). A brief pullback (Wave ii) may follow, likely finding support near the previous resistance before Wave (iii) propels the price toward $42-$44, the next major resistance zone.

AVAX price prediction
AVAXUSD breakout expected soon | Credit: Nikola Lazic/TradingView

Wave (iii) is expected to be the strongest, fueled by increasing momentum. A minor correction (Wave iv) should hold above $40, leading to the final Wave (v), targeting the $53-$55 range, aligning with the 0.786 Fibonacci retracement.

Sustained bullish momentum could extend gains beyond $55, potentially reaching $65.

If AVAX fails to hold above $34, the bullish outlook weakens. A break below $29 would invalidate the impulsive structure, signaling potential downside continuation.

However, as long as price action respects key support zones, the probability of a rally toward $50+ remains strong, completing the final leg of this bullish cycle.

Key Levels to Watch

  • Immediate Resistance: $36.10 (0.382 Fibonacci retracement)
  • Key Resistance: $41.68 (0.5 Fibonacci retracement)
  • Major Resistance: $47.24 (0.618 Fibonacci retracement)
  • Short-Term Target for Wave (v): $53.23 – $55.15
  • Immediate Support: $34.00 (current pivot zone)
  • Critical Support: $29.25 (0.236 Fibonacci retracement)
  • Invalidation Level: Below $29.25, weakening bullish outlook

 

Disclaimer: The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Was this Article helpful? Yes No

Nikola Lazic

Nikola Lazic is a cryptocurrency analyst and investor working in the industry since 2017. He holds a bachelor's degree in Sociology, which enables him to better understand the psychology behind the crowd´s positioning. Consequently his preferred analytical tool is Elliott Wave Theory in combination with price action analysis. Combining his experience in trading and investing with knowledge in content writing he strives to bring the most accurate and actionable information. Expertise: Cryptocurrencies, Technical analysis, Elliott Wave Theory, On-chain metrics, Research reports.
See more