Is it better to invest in AVAX now or should you consider other options? Read more to find out!
AVAX/USDT on a Weekly Chart
Fibonacci extension levels are a great tool to add onto your arsenal of indicators, because they tend to give some possible future price levels. The 1.618, 2.618, etc. are extensions from that level and are also visible on the chart.
When AVAX bottomed out in June, it started a really strong uptrend. As you can see, not all Fibonacci extension levels work as instant resistance, especially when a coin is as strong as AVAX was in the second half of 2021. Its price went past the 1.618 level like a hot knife through butter.
The price wicked a few times into that demand zone, rallied, and printed a lower high. Zooming in on the chart right now should give more information. Let’s find out!
AVAX/USDT on a Daily Chart
When they are all trending upwards, they can provide support and show the trend. As you can see, when AVAX managed to reclaim all the EMAs in August 2021, it started an uptrend again. From that point, when the token reached $15, it offered a 10X return on investment in only four months’ time. It’s obviously impossible to always sell the exact top, but you would’ve made good gains riding that trend.
Also, AVAX made a lower high at around $127 and is now finding resistance from the 100 EMA.
There is a cluster of support a little bit lower, between $73.40 and $79.80, and the 200 EMA, which is around $70.50 at the time of writing.
If AVAX bulls can’t hold up the price here and the token falls below the support zones, the bears will be in control.
However, if AVAX would form a range between ~73 and ~127, a period of re-accumulation could start.
AVAX/USDT on a 4-Hour Chart
On this 4-hour chart, you see that AVAX made an ATH in November, and made a lower high on Dec. 1. Later that month, AVAX bulls tried to push the price past that high, but they failed.
AVAX started trending downwards again, all the way to the previously described daily demand zone. That is where it bounced from and, at the time of writing, the bulls are trying to reclaim the broken demand zone. However, the EMAs are trending downwards and the 21 EMA is acting as resistance.
If AVAX can’t reclaim these levels, more downside should be expected. A reclaim of ~98-$100 would be bullish, at least in the short term.
The native token of Avalanche, AVAX, had a lot of bullish momentum last year. However, AVAX is currently trending downwards.
- The weekly chart shows a lower high, but also a higher low. A break above the high or below the low should dictate the trend.
- The daily chart shows the same picture — and where the EMAs were supportive for months, they are now starting to act as resistance.
- The current downtrend is also visible in the 4-hour time frame. AVAX is trending downwards, but important support zones still act as support.
Keep in mind that all of the above are solely the writer’s thoughts. Never take anything for granted and always do your own research.