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Bearish Trends and Bullish Opportunities: Comprehensive AXS Analysis
Detailed AXS Technical Analysis
Welcome back to another edition of The Crypto City Trading Newsletter, your go-to source for in-depth technical analysis and expert insights into the dynamic world of cryptocurrency trading. Today we are focusing on the Daily and Weekly price action of AXS/USDT.
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Total AVAX Market Cap: $807,305,019
Circulating Supply: 147,733,737 AXS
Total Supply: 270,000,000 AXS
Max Supply: —
AXS Technical Analysis: Navigating Key Support and Resistance Zones
Overview
This technical analysis provides an in-depth look at the AXS. The analysis focuses on identifying key support and resistance levels, recent price movements, and possible future scenarios, as well as a continuous descending trend line that has influenced price movements in recent months. By analyzing these factors, traders will gain insight into the current market condition and make better trading decisions.
The chart shows three key resistance zones that traders should keep a close eye on. The most prominent of these is the weekly resistance zone (Green) $6.592 to $6.908. Historically, this range has been a tough barrier, with the price failing to break above it several times. A break above this zone could indicate a significant bullish change, potentially resulting in big gains. In addition, there are two major resistance zones, one weekly in Pink and the other in Daily Blue. There are two more resistance levels marked on the chart at $5.510 and $10.663, these levels also act as barriers to moving the price upwards.
On the support side, the monthly support zone in Yellow has given a firm foundation for AXS. The price is at a recent support level at $4.919 and consolidates on the level from a few days. The price has just bounced from this zone, indicating that it continues to draw strong buying interest. This support zone is critical to preserving the long-term positive picture, as a breakdown below it could result in more falls.
A descending trend line from the peak at $12.377 indicates a long-term downturn. For the bearish trend to turn, AXS must strongly break above this trend line. The current market movement indicates a bounce from the monthly support zone (Yellow).
The analysis also discusses recent price action, which has been marked by a downturn and a period of consolidation between support and resistance. The descending trendline highlights the bearish sentiment.
The analysis discusses both bullish and bearish scenarios, outlining potential outcomes depending on price movements above important resistance levels or below critical support levels. The objective is to provide traders with an extensive understanding of current market dynamics, allowing them to predict price movements and adjust their trading strategies accordingly.
The AXS/USDT chart shows price movements within well-defined support and resistance zones, both on a weekly and monthly basis. The analysis below breaks down these zones, trend line, and potential future movements.
We are now moving toward the chart.
Weekly Chart
In the weekly chart, AXS is trading on the weekly support zone (Green) $3.698 – $4.476. The price is consolidating between the support zone in Green and the resistance zone (Blue) at $11.136 – $13.507 for approximately 637 days. The support zone (Green) is holding the price if it fails we might see it to the next support zone (Yellow) at $2.154 – $2.429. However, according to our analysis, we are not expecting the price to break the major support zone (Green). If it does we add more AXS/USDT to our spot bags. We will discuss the buying plan in the trading setup section.
Daily Chart
Now we are zooming in on a Daily chart.AXS is trading on the support level at $4.919 and bounced back from the monthly support zone (Yellow). The price has been trading under the descending trend line for approximately 119 days. When the price reached the monthly resistance zone (Blue) we saw a correction in the market. The descending trend line acts as a strong resistance while the price is falling down. Several key technical elements and zones are marked, providing a comprehensive view of the market’s structure and potential future movements.
Key Zones and Levels
Recent Resistance Level $5.510
This is the recent resistance level. The price of AXS has to flip this level to move upwards. This level has been tested many times previously and acts as a strong barrier for the price to move further.
Weekly Resistance Zone (Green) $6.592 – $6.908
This zone is important because it signifies the barrier that the price must overcome in order to continue its upward trend. Breaking above this zone would indicate the start of a potential bullish trend, encouraging traders to target the next resistance zone at $8.635 – $8.973.
Weekly Resistance Zone (Pink) $8.635 – $8.973
This zone has been tested several times in the past and serves as a strong resistance zone for the price. Each attempt to break above this zone has been faced with significant selling pressure, resulting in price rejections and subsequent falls. A successful breakthrough above this level would not only indicate a shift in market sentiment but could also clear the way for the price to move toward the next resistance level.
Resistance Level $10.663
This area has been tested many times before and acts as a strong barrier to the price. Every time the price tries to go above this zone, it faces a lot of selling, causing the price to drop. If the price breaks through this barrier, it could rise toward the next daily resistance zone marked in blue.
Daily Resistance Zone (Blue) $12.37 – $13.482
This zone has historically acted as a strong resistance zone, with multiple rejections observed within it. Any attempt to break above this zone could indicate a big bullish surge, pushing the price to new highs.
Monthly Support Zone (Yellow) $3.968 – $4.476
This zone acted as a strong support zone and represents the long-term support zone. AXS/USDT has found a good base here, and any dip into this range could generate major buying interest.
Trend Line
The red trend line on the chart indicates a downtrend that has been in place since the price hit the peak in March 2024 around the monthly resistance zone. The price needs to break above this downtrend line to signal a potential reversal.
Volume Analysis
Currently at the time of writing the trading volume is at $1.77M, the buying volume is 506.404K and the selling volume is 541.659K, indicating a lack of strong buying interest at the current levels. A significant increase in volume would be necessary to confirm any potential reversal or breakout.
Recent Price Action
- The price has recently rebounded from the monthly support zone Yellow showing a potential recovery.
- After bouncing off the support, AXS faced resistance around the $5.510 level.
- The volume has shown some increase, indicating a potential accumulation phase. However, sustained volume is needed for a strong breakout.
Potential Scenarios
Bullish Scenario
If the price breaks above the $5.510 level sustains above it and breaks above the descending trend line it could target the next weekly resistance zone Green at $6.592 – $6.908. Further bullish momentum might push the price toward the next weekly resistance zone in Pink at $8.635 – $8.973.
Bearish Scenario
Failure to break the resistance level at $5.510 could lead to a retest of the recent lows around $4.919. A breakdown below this level could see the price move towards the monthly support zone Yellow at $3.968 – $4.476.
Technical Indicators
Based on technical indicators on a daily time frame
The relative Strength Index (RSI) value is at 42.498 (Neutral)
Momentum (10) is at -0.427 signaling a (Buyl)
MACD Level (12, 26) is at -0.384 signaling (Buy)
Exponential Moving Average (50): 6.381 (Sell)
Exponential Moving Average (100): 7.043 (Sell)
Simple Moving Average (100): 7.209 (Sell)
Exponential Moving Average (200): 7.406 (Sell)
Ichimoku Base Line (9, 26, 52, 26): 5.598 (Neutral)
Volume Weighted Moving Average (20): 5.517 (Sell)
Hull Moving Average (9): 5.362 (Buy)
Interpretation
The AXS technical indicators for the 1-day timeframe indicate a mostly bearish view, with the overall sentiment leaning toward “Sell.” The oscillators are generally neutral, with 9 neutral readings and 2 buy signals, indicating a lack of substantial momentum in any direction. However, the moving averages are more negative, with 11 of 15 indicators indicating a sell, indicating a prevailing decline. The few buy indications from shorter-term moving averages point to expected short-term upward bounces. Overall, the data says traders should take care, as the overall trend remains bearish despite occasional indicators of short-term bullish swings.
Liquidation Heatmap
The AXS Liquidation Heatmap for the previous three months shows substantial areas of liquidation pressure and potential price levels where liquidations are concentrated. The highlighted zone at $6.4629 is a critical resistance level where substantial liquidation activity has occurred, as indicated by the intense coloration on the heatmap. This level has operated as an upper limit for higher price movements, indicating that many leveraged positions are likely being liquidated at this price point. The many liquidation activities around this level have established a strong resistance barrier, making it an important level for traders to monitor.
Token Summary
Interesting on-chain metrics that provide a rapid understanding of the state of AXS
The token summary provides a comprehensive overview of key metrics for a cryptocurrency. Notably, only 4% of holders are making money at the current price, while a staggering 95% are at a loss. The token is highly concentrated, with 96% of it held by large holders, indicating potential market manipulation or control by a few entities. Its price shows a high correlation of 0.88 with Bitcoin, suggesting it closely follows Bitcoin’s price movements. In terms of holder composition, 77% have held the token for more than a year, 21% for 1-12 months, and 2% for less than a month. Over the past week, transactions greater than $100,000 totaled $4.33 million, while the Telegram community saw a marginal increase of 0.05% in members. Geographically, transactions are fairly balanced, with 52% from the West and 48% from the East. However, the token experienced a net outflow of $1.25 million over the last week. These data points suggest that the token is struggling, with most holders incurring losses, high concentration among large holders, and a significant outflow of funds, indicating reduced investor confidence or profit-taking.
Actionable Signals
The signals summary provides both on-chain and exchange signals for the cryptocurrency. Overall, the sentiment is “Mostly Neutral,” with an equal split of three bearish and three bullish signals. The on-chain signals indicate mixed outcomes: net network growth is slightly bearish at 0.18%, the “In the Money” metric is bullish at 10.53%, showing that a portion of holders are in profit, concentration is almost neutral with a slight bearish tilt at -0.01%, and large transactions are significantly bearish at -12.07%. In contrast, the exchange signals are entirely bullish, with both the smart price and bid-ask volume imbalance showing 0.00% bullishness. This data suggests that while the overall market sentiment is neutral, with conflicting bearish and bullish indicators, the token might be experiencing some positive momentum on exchanges despite bearish on-chain activity, particularly in large transactions. This could imply short-term trading opportunities despite longer-term concerns.
Long-Term Trading Setup
AXS right now is dropping and we see there might be an opportunity to buy when it falls further. So we will buy in parts, we will divide our budget into 3 sections, and allocate for buying at each key support mentioned in the chart.
Here are the numbers where you can buy AXS and take profits for the trade.
Buy 1: $5.462
Buy 2:$4.476
Buy 3:$3.698
At buy 3 we will go all in because this is the lowest we are expecting AXS to fall.
TP1: $8.973
TP2: $10.663
TP3: $13.482
Conclusion
The detailed technical analysis of AXS highlights the current market dynamics and potential future price movements. The analysis identifies key support and resistance levels, recent price trends, and critical indicators that traders should monitor. Currently, AXS is trading near its support levels, with significant resistance zones identified. The market shows a mix of bullish and bearish signals, with the overall sentiment being “Mostly Neutral.” On-chain data indicates a high concentration of large holders and a substantial number of holders at a loss, while exchange signals suggest potential short-term bullish opportunities. The long-term downtrend is underscored by the descending trend line, which AXS must break to signal a potential reversal. The suggested trading strategy involves buying at key support levels and taking profits at specified resistance levels, indicating a cautious yet strategic approach to potential market gains. Overall, this comprehensive analysis equips traders with the necessary insights to navigate the current market conditions and make informed trading decisions.
From this content, we deduce that AXS is in a precarious position with a bearish trend, yet there are opportunities for traders to capitalize on potential short-term gains. The recommendation is to buy at key support levels and target higher resistance zones for profit, emphasizing the importance of closely monitoring market signals and adjusting strategies accordingly.
Investment Outlook
Given the current market conditions, AXS presents both opportunities and risks. The identified key levels should guide investors in making informed decisions. Caution is advised until a clear trend is established.
Your Essential Trading Newsletter
This detailed analysis provides a comprehensive understanding of the current market structure and potential scenarios. Traders can use these insights to make informed decisions and effectively navigate the market.
Stay tuned to The Crypto City Trading Newsletter for more in-depth analyses, market insights, and expert guidance. As always, we strive to empower you with the knowledge and tools needed to navigate the fast-paced world of cryptocurrency trading. Happy trading!
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The Crypto City Trading Team