Avalanche (AVAX) price attracted attention by rising above $40 on February 10, following its rise in the last 20 trading days. This rise led to the price rebounding strongly from the long-term horizontal support zone, while continuing its tendency to trade within short-term resistance levels. With this latest move, AVAX once again demonstrated the increasing interest among investors in the market.
According to weekly technical analysis, AVAX price has been on a steady rise since January 22, confirming a horizontal zone as support during this time. However, this area had been acting as resistance since May 2022. Despite the recent progress, the price still has not broken above the 2023 high, which suggests that AVAX is facing some resistance.
Avalanche Price Analysis
The weekly Relative Strength Index (RSI) is showing mixed readings. Traders often use the RSI to identify overbought or oversold conditions. Despite being above 50, the indicator failed to recover over the past two months before falling back and falling below the overbought zone.
On the daily timeframe, the future direction of AVAX is yet to be confirmed due to uncertain price movements. The progress since January 2022 has occurred within an ascending parallel channel that generally surrounds corrective moves.
On February 10, the channel resistance line rejected the AVAX price at $40. However, the daily RSI is exhibiting a bullish reading by moving above 50 and indicating an uptrend.
It has been suggested that the AVAX price will follow SOL if it experiences an increase. It is stated that if the price of SOL rises, AVAX will follow it. ImmortalCrypto referred to this dynamic as “muscle memory” in a tweet.
AVAX’s reaction to the $40 region will be key in determining its future direction. A successful breakout could indicate a 23% upside potential towards the 2023 high of $50. However, a rejection and channel breakout in this zone could result in a 16% decline towards the nearest support level at $33. Therefore, the $40 level could be decisive for AVAX’s near-term price movements.
Koinfinans.com As we reported, AVAX is trading at $41 at the time of writing.
