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AVAX Headed To $30? Avalanche Declined 15% In 8 Days, Failing To Break $40 Resistance

Last Updated May 30, 2024 3:18 PM
Nikola Lazic
Last Updated May 30, 2024 3:18 PM

Key Takeaways

  • AVAX’s price stabilized at around $35 after a 55% drop.
  • Brief breakout to $41, returned to trading around $36.
  • The potential for a new uptrend or further correction remains.

Since April 13, after experiencing a 55% drop, the Avalanche (AVAX) price has mostly stabilized around $35. On May 15, it dipped to $31, testing its lower support level, but soon rebounded, pushing past the $40 resistance and exiting the consolidation zone.

However, after briefly reaching $41 on May 22, a downturn followed, and the price of AVAX is now back below it, trading at $36. 

AVAX Price Analysis

Following a peak of $65 on March 18, AVAX‘s price began a steep decline, eventually bottoming out at $30 on April 13. This initiated a 46-day period of sideways trading. This consolidation phase ended positively, with a breakout above the $40 level from the formed symmetrical triangle. 

AVAX
AVAXUSD | Credit: Nikola Lazic/Tradingview

This recent peak concluded a major uptrend that began at $9 in October of the previous year. It was part of a five-wave impulse suggesting a larger bull cycle. However, it transitioned into a correction phase.

While AVAX has been trading horizontally, a sustained move above $40 indicates potential upward momentum. Further declines may occur until this breakout is confirmed, but the overall trend could remain bullish.

AVAX Price Prediction

Zooming into the 4-hour chart and examining the wave structure in more detail, we can see that two scenarios are possible. AVAX might be initiating a new bull phase, potentially reaching new highs, or it could still be in a corrective phase with another significant drop impending.

 

AVAX
AVAXUSD | Credit: Nikola Lazic/Tradinview

If AVAX continues to rise above $50 and forms a higher high, a five-wave pattern would emerge, and an ascending triangle would be validated. That would mean AVAX commenced a new uptrend, with its first sub-wave being the leading diagonal. 

After a short retracement for a higher low, the price could continue climbing with stronger momentum and make up for all the gains previously lost. 

Conversely, if AVAX faces rejection and falls back to $30, it could suggest that buyers lack the strength to sustain higher prices, potentially leading to a decline similar in magnitude to the earlier drop, targeting around $23.

These two outcomes differ in the meaning behind the sideways move from April 13. If this is the starting uptrend, it should confirm its bullishness with another higher high and a higher low. However, reverting to $30 would mean the structure was corrective, and further lows would look more likely. 

Disclaimer
Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.
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