The AVAX/USDT pair traded inside a broadening wedge pattern on the daily time frame chart for about two and a half months. Following this pattern, this coin's short-term rebound culminated at the $30 level, where it produced a local top. Additionally, a sizeable correction rally was sparked by the bearish reversal from this resistance after the US Fed's September hint at an increase in interest rates.
AVAX price dropping below the 0.618 FIB will signify a slowing of the bullish trend. The extended correction theory is supported by the daily-RSI slope's steeper descent into bearish territory. Avalanche network's coin has $442.4 million in intraday trading volume, representing a 5.17% rise.
Theoretically, as the price breaks the ascending support trendline, this bearish continuation pattern intensifies the selling pressure. As a result, on August 26th, the market as a whole experienced a significant sell-off that encouraged sellers to break through the pattern's support trendline.
The AVAX price has currently dropped to $20, losing 33.4% over the last two weeks. The 0.618 Fibonacci retracement level and this psychological level, however, give a powerful confluence launchpad to support a bullish reversal.
A potential reversal, however, might serve as a testing phase for the channel collapse and push prices 12% higher to the broken trendline at $22. The interested short sellers may seize a favourable entry chance if the retest candle maintains below the trendline.
On the other hand, the bearish thesis will be disproved if the altcoin crosses above the flipped resistance trendline during the retest phase.
Vortex indicator: A bearish alignment with a significant difference between the VI+ and VI- slopes suggests that the bear is in control of the trend.
EMAs: A bearish crossover between the 20- and 50-day EMA may encourage additional sellers to push the price down to $16. Additionally, these broken EMAs ought to provide strong resistance to keep a negative trend going.
levels of resistance: $22.16 and $26.21
Levels of assistance: $20 and $16.5
To know more about Avax coin keep following CoinGabbar.
