Key Insights:
- AVAX trades within a bullish falling wedge, indicating a potential price reversal if resistance is broken.
- Daily active addresses reach 51K, showing rising network activity despite the recent downtrend.
- A breakout above $24-$25 could confirm bullish momentum, with targets at $30 and beyond if sustained.
AVAX price is indicating bullish reversal signal as the price trades within a falling wedge pattern. Daily active addresses have also risen indicating increasing market participation and network activity.
AVAX price Analysis And Bullish Reversal pattern
AVAX price has been in a downtrend with its lower highs and lower lows forming a falling wedge pattern. This is a common bullish reversal signal, indicating that the price broke through the resistance level.
At the moment, AVAX is going through a test of the lower boundary of the wedge, trading at around $21.50 to $22.00. Breakout above $24.00–$25.00 resistance zone will confirm pattern, possibly pushing the price to $30.00 or more according to height projection of wedge.
Market analyst MarzellCrypto stated, “$AVAX is testing a key support zone, aligning with the Fibonacci retracement levels, indicating a potential bullish reversal on the weekly chart.” According to the analyst, if the support holds, AVAX could see strong recovery with medium-term price targets at $43.84, $58.06, and $80.03.
Daily Active Addresses Show Increased Network Activity
Despite the price in a downtrend, the number of daily active addresses has been progressing, showing increasing network participation. The number of active addresses in the market has fluctuated during the last 3 months with spikes at the beginning of January and mid February.
Based on the most recently reported data, 51K of the Avalanche network’s daily active addresses carry out transactions. Also, the increase indicates that there is higher user engagement and long term holders accumulation. Above all, however, historical trends suggest that previous spikes in active addresses did not immediately send prices soaring, hence further confirmation is required.
Technical Indicators and Key Resistance Levels
Several technical indicators point out to the fact that AVAX is preparing for a possible reversal. Relative Strength Index (RSI) is currently at 41.60, rising out of oversold territory. Once the RSI crosses above the midline which is at the 50 level buying momentum is building up and the market sentiment turning bullish.
Cumulative Volume Delta (CVD) is at –19.9K as selling pressure has dominated in recent sessions. But a change in CVD could be an indication of amassing by bigger buyers, which could help fuel the recovery.
On its turn, the Moving Average Convergence Divergence (MACD) indicator is indicating early bullish signs of a crossover. A breakout from the current downtrend could be supported by an upward momentum confirmed if MACD line crosses above signal line.
In order for AVAX to validate a bullish breakout, it must hold above $21.50 support and break the $24.00 – $25.00 resistance. Moreover, a successful breakout may open the possibility of a move towards $30.00 and above. If the support for $21.50 is not held then the downtrend may be extended to lower price levels. The AVAX open interest (OI) has also risen by 6.43%, currently standing at $218.5M across all contracts (perpetual swaps).
Disclaimer
In this article, the views and opinions stated by the author or any people named are for informational purposes only, and they don’t establish the investment, financial, or any other advice. Trading or investing in cryptocurrency assets comes with a risk of financial loss.
Olivia Stephanie is a FinTech enthusiast with a keen understanding of financial markets. Her passion for economics and finance has led her to explore emerging blockchain technology and cryptocurrency markets.