Aaryamann Shrivastava
FXStreet
- AVAX price drops by more than 5% to trade near $16.50.
- The indicators, along with the price action, suggest a decline below $14.91 might be imminent.
- If the Avalanche price manages to rise above the critical resistance at $20.32, the bearish thesis would be invalidated.
AVAX price has been slipping on the charts for nearly ten days now, and the altcoin is inching closer to its critical support. From here on, the bulls will have to regain control of the momentum they had back in January to prevent a significant decline in AVAX’s trading price.
AVAX price continues its downtrend
AVAX price is currently trading around at the $16.50 area, having decreased by over 5% in the span of 24 hours. The cryptocurrency had already lost immediate support at $17.20 and could be seen heading toward critical support at $14.91.
The Avalanche price is on a downfall, and looking at the indicators, it seems like the trend will continue going forward. The Moving Average Convergence Divergence (MACD) indicator exhibited a bearish crossover a few days ago, which has not been invalidated yet. The signal line (red) continues to stand far above the MACD line (blue).
AVAX MACD and RSI
Similarly, the Relative Strength Index (RSI) is also suggesting a bearish outlook at the moment. The presence of the indicator in the bearish zone hints at a further decline.
Thus, if this narrative plays out and AVAX falls below the critical support level at $14.91, the altcoin could end up crashing by more than 15%, testing the lows of $14 and even lower.
AVAX/USD 1-day chart
However, if the RSI ends up either bouncing off the 30.0 mark or slips into the oversold zone, a reversal could occur, which, if leveraged by the bulls, could result in a recovery rally.
AVAX price would need to rise up to the critical resistance at $20.32 and flip it into support to invalidate the bearish thesis, which could also lead to the Avalanche price climbing to the five-month high of $21.58.
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