- Avalanche price has been oscillating within a falling wedge technical formation on the weekly timeframe.
- A break out from the chart pattern could catapult AVAX over 90% north with the crypto market showing strength.
- A weekly close below the $8.51 level would invalidate the bullish thesis, extending the southward consolidation for the altcoin.
Avalanche (AVAX) price is trading with a bullish bias up close, despite the general downtrend to the naked eye. The altcoin seems to be taking to the broader market optimism, sprouting after being a sleeper for some time now.
Also Read: Avax price prediction – Has Avalanche bottomed out or are more drops on the way?
Avalanche coils up for a breakout to $31.45
Avalanche (AVAX) seems to have bottomed out on the weekly timeframe, with a falling wedge pattern filling up. This technical formation forecasts a bullish momentum and forms when the price of an asset bounces between two trendlines that are not only sloping downward but also converging. If a falling wedge actualizes, it executes a reversal, but if it does not actualize, it enables the continuation of the trend, in this case, the primary trend as we are working with a weekly timeframe.
Increased buying pressure could see Avalanche price breakout above the upper trendline, with confirmation of such a move above the $15.84 resistance level. Further north, the price could extend to test the supply zone extending from $25.58 to $30.89. To confirm the extrapolation of the uptrend to the conservative target of $31.45, the price must break and close above the midline of the supply barrier at $28.55.
In a highly bullish case, Avalanche price could flip the $31.45 resistance into a support floor, effectively rendering the supply zone a bullish breaker and using it as the jumping-off point to the next supply barrier, which extends from $51.07 to $62.11.
The surge comes after the Relative Strength Index (RSI) called a signal to buy AVAX when it crossed above the signal line (yellow band). Traders heeding this call has Avalanche price almost 65% north. With the northbound move of the RSI, momentum is still rising, tipping the odds further in favor of the upside.
The Awesome Oscillator (AO) is also inching toward the positive territory, with its histograms taking the green shade to indicate bulls are heading the AVAX market.
AVAX/USDT 1-week chart
On the flip side, a rejection from the upper boundary of the falling wedge could send Avalanche price south, possibly falling below the last lower low, effectively invalidating the bullish thesis. A continuation of the primary trend could send AVAX to the range low of $2.75, levels last tested in December 2020.
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