Avalanche (AVAX) Price Jumps 70%, Ending 175-Day Downtrend Pattern

Key Takeaways

• Avalanche (AVAX) broke out from a long-term parallel channel.
• The Avalanche Latin America Summit will be held on Oct.16-18.
• Has AVAX begun its bullish trend reversal, or is the bounce a relief rally?

The Avalanche price fell nearly 75% between its yearly high in March and low of $17.29 in August. The decline wiped out all the gains made since the start of the year.

AVAX trades 25% below its yearly open despite the ongoing bounce.

Nevertheless, the upward movement caused a breakout from a 175-day pattern that existed since the yearly high.

Positive Avalanche News

There has been a slew of positive AVAX news recently. Firstly, Avalanche game Off The Grid is the most popular free game on the Epic Games Store and the #1 trending game on Epic.

Avalanche also announced the Retro9000 grant program , which will give up to $40 million in grants to builders.

Finally, the Avalanche Latin America (LATAM) summit will be held between Oct. 16-18.

Avalanche will offer free admission to builders in Latin America since they consider the region a Web3 Incubator and Argentina a cryptocurrency hotspot with over $85 billion in transactions in 2023.

Avalanche Breaks Out

The weekly time frame AVAX price chart shows a decline inside a descending parallel channel since the yearly high of $65.39 in March.

Such channels usually contain corrective patterns, meaning that an eventual breakout from it will be likely.

After five unsuccessful breakout attempts (black icons), AVAX finally moved outside of the channel in mid-September. Despite an initial decline, it trades above its pre-breakout levels.

The breakout followed a bounce on Aug. 5 (white icon), which validated the channel’s support trend line and saved a breakdown from the $20.50 horizontal area.

Technical indicators are gradually turning bullish. The Relative Strength Index (RSI) is moving above 50 (black circle), and the Moving Average Convergence/Divergence (MACD) has just made a bullish cross, both implying that the breakout is valid.

AVAX Price Rally?

The wave count aligns with the bullish readings and suggests that the AVAX price has started its bullish trend reversal.

The most likely count suggests that AVAX has completed a five-wave increase (white) and a W-X-Y correction (black) since September 2023.

In the correction, waves W: Y had a 1:1 ratio, and so did sub-waves A: C (white), which created wave Y. Because of this proportionality, it is likely the correct count.

If the ensuing upward movement has the same length as the previous one, the AVAX price will increase by 350% and reach a high of $131.

While an extremely sizeable increase, this would still be below the all-time high price of $146.

New Yearly High

The ongoing AVAX bounce could start a new bullish trend reversal since it has caused a breakout from two long-term resistance levels.

The extra attention at the AVAX LATAM summit could also boost the AVAX price. As a result, AVAX may continue its ascent well above its yearly high.

Read More: Avalanche Price Prediction 2024: AVAX Price Analysis