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Detailed AVAX 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 AVAX/USDT.
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Total AVAX Market Cap:Â Â Â Â Â Â Â Â $10,267,586,384
Circulating Supply:Â Â Â Â Â Â Â Â Â Â Â Â 394,282,809 AVAX
Total Supply:Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 443,629,179 AVAX
Max Supply:Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 715,748,719 AVAX
Overview
This technical analysis provides an in-depth look at the AVAX. The analysis focuses on identifying key support and resistance levels, recent price movements, and possible future scenarios. By analyzing these factors, traders will gain insight into the current market condition and make better trading decisions.
Key support zones (Green) between $22.59 – $25.08 have been highlighted, showing areas of significant buying activity. However, a recent resistance level at $29.51 and a trend line, indicate where selling pressure may limit upward momentum.
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.
Volume analysis shows relatively not much trading activity, indicating a lack of significant momentum in either direction. This may indicate potential volatility when important support or resistance levels are tested.
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 AVAX/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, AVAX is trading on the weekly support zone (Green) $22.59 – $25.08. The price is consolidating between the support zone in Green and the resistance zone (Blue) at $49.95 – $58.21 for approximately 210 days.The support zone (Green) is holding the price if it fails we might see it to the next support zone (Yellow) at $14.13 – $15.86 and that is the best buying area. However, according to our analysis, we are not expecting the price to break the major support zone (Green). If it does we add more AVAX/USDT to our spot bags because this is a good coin fundamentally to hold. We will discuss the buying plan in the trading setup section.
Daily Chart
Now we are zooming in on a Daily chart.AVAX is trading on the weekly support zone (Green) at $22.59 — $25.08.The price is trading under the descending trend line for approximately 111 days. When the price reached the monthly resistance zone (Blue) at $49.95 – $58.21, 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
Monthly Resistance Zone (Blue): $49.95 – $58.21
This zone represents a significant area where the price has struggled to move above. The monthly resistance zone is crucial for long-term traders, high selling pressure exists here. Breaking through this zone would take the price to a previous all-time high.
Resistance Level: $39.45
Another critical level of resistance lies at $39.45. This level has been tested multiple times, indicating strong selling interest. A breakthrough above this level could attract more buyers, pushing the price higher to the next monthly resistance zone (Blue).
Recent Resistance Level $29.51
This level is the recent resistance level a breakout above this level could attract more buyers. After flipping this level with momentum we could see a bullish move up side.
Weekly Support Zones (Green): $22.59 – $25.08
This support zone is holding the price indicating that it is a significant area of interest for traders. The price testing of this zone is approximately 19 days. A drop below this level could lead to further declines.
Weekly Support Zones (Yellow): $14.13 – $15.86
This is another important support area. If the price breaks below the Green zone, this would be the next major support level to watch.
Monthly Support Zone (Pink): $6.84 – $9.33
This is the key support level where buyers have historically stepped in to prevent the price from falling further. A dip into this zone could present a buying opportunity for long-term investors. If this zone is breached, it could signal a substantial bearish trend.
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.
Current Price: $26.36
At the time of writing the current price of AVAX/USDT is $26.36. The price has been in a downtrend since reaching the resistance zones and is now trading on a significant support area.
Volume Analysis
Currently at the time of writing the trading volume is at $81674K, the buying volume is 364.9K and the selling volume is 451.84K, 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.
Potential Scenarios
Bullish Scenario
If the price manages to break above the downtrend line and resistance at $29.51 and sustain above, it could target the next resistance at $39.45. If the momentum is intact, a successful breakout above $39.45 would aim for the monthly resistance zone (Blue) at $49.95 – $58.21. According to our analysis, there is less chance that the price may not drop from the Green zone.
Bearish Scenario
If the price fails to hold above the current weekly support zone (Green), it may decline further towards the lower next support level at $18.90. A break below this level could push the price down to the weekly support zone(Yellow) at $8.61 – $9.33. However, more bearish momentum might take the price to the next level at $11.16 and further the price to the last zone marked on the chart in Pink.
Technical Indicators
Based on technical indicators on a daily time frame
The relative Strength Index (RSI) value is at 42.70 (Neutral)
Momentum (10) is at -1.64 signaling a (Sell)
MACD Level (12, 26) is at -1.31 signaling (Buy)
Exponential Moving Average (50): 30.57 (Sell)
Exponential Moving Average (100): 33.59 (Sell)
Simple Moving Average (100): 35.23 (Sell)
Exponential Moving Average (200): 33.66 (Sell)
Ichimoku Base Line (9, 26, 52, 26): 27.90 (Neutral)
Volume Weighted Moving Average (20): 26.45 (Sell)
Hull Moving Average (9): 25.33 (Buy)
Interpretation
The current technical analysis for AVAX/USDT shows strong sell signals based on the moving averages, while the oscillators are largely neutral with some leaning towards sell. The overall market sentiment appears bearish, with the majority of indicators pointing towards selling pressure.
Liquidation Heatmap
Token Summary
Interesting on-chain metrics that provide a rapid understanding of the state of AVAX
The token summary for AVAX shows a balanced market sentiment, with 47% of holders making a profit, 51% at a loss, and 2% breaking even. Ownership is highly concentrated, as 72% of AVAX is held by large holders. The token’s price strongly correlates with Bitcoin, with a correlation of 0.8, indicating that its price movements closely follow Bitcoin’s trends. Holder composition reveals a mix of long-term and newer investors, with 45% holding for over a year, 50% for 1 to 12 months, and 5% for less than a month. In the past week, AVAX experienced substantial trading activity, with $982.12 million in transactions over $100K, and a slight increase in community engagement, evidenced by a 0.16% rise in Telegram members. Transaction demographics are fairly evenly distributed globally, with 54% of activity in Western regions and 46% in Eastern regions. Overall, AVAX displays significant influence from large holders, high trading volume, and active community participation.
Actionable Signals
The image displays various financial signals categorized into summary, on-chain signals, and exchange signals. The overall summary gauge indicates a “Mostly Bearish” sentiment, with three bearish indicators, two neutral, and one bullish. Onchain signals show mixed results: Net Network Growth is slightly bearish at 0.30%, “In the Money” is strongly bearish at -5.20%, Concentration is marginally bullish at -0.10%, and Large Transactions are neutral at 2.20%. Exchange signals also exhibit a bearish trend, with a neutral Smart Price at 0.01% and a significant bearish Bid-Ask Volume Imbalance at -28.37%. Overall, the indicators suggest a predominantly bearish outlook in the market.
Long-Term Trading Setup
AVAX 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 AVAX and the take profits for the trade.
Buy 1: $26.06
Buy 2:$18.90
Buy 3:$15.80
At buy 3 we will go all in because this is the lowest we are expecting AVAX to fall.
TP1: $39.45
TP2: $50
TP3: $65.39
Conclusion
The AVAX/USDT pair is at an important point. The price is testing key support levels, and the next few days or weeks will be crucial in determining its direction. Traders should watch for a break above the downtrend line and resistance zones for a bullish signal, while a drop below the current support levels could indicate a bearish continuation. The overall sentiment is mostly bearish, with several indicators pointing to selling pressure and limited buying interest. It’s important to keep an eye on the key support and resistance zones, trading volumes, and technical indicators. Always use proper risk management when trading.
Investment Outlook
Given the current market conditions, AVAX 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