Avalanche (AVAX) is attempting to create its first higher low since reaching a temporary bottom in June, however it has yet to show any decisive bullish reversal signs.
The AVAX non-fungible token (NFT) marketplace is booming and this week it saw a new seven-week high in volume. Roughly 48% of this volume came from Chickn. This comes around the same time that the Bitcoin.com wallet announced that it had started supporting AVAX.
AVAX price movement
Despite the flurry of positive news, the price has yet to confirm any sort of bullish reversal. To the contrary, AVAX has broken down from an ascending support line that had been in place since the June lows. Such breakdowns usually mean that the preceding upward movement has now come to an end.
If a short-term bounce transpires, there would be strong resistance at $22.60. This is the 0.382 Fib retracement resistance level and coincides with the previous ascending support line.
AVAX wave count analysis
The wave count shows that it is possible that it has completed an A-B-C corrective structure measuring from the all-time high. In it, waves A:C have had an exactly 1:1 ratio. The sub-wave count is given in black, also showing a completed corrective structure.
So, if the count is correct, it would mean that the price has completed its correction and initiated a new upward movement on June 18.
However, the short-term movement casts some doubt in this possibility, since it shows a completed five-wave downward movement since the Aug 8 high. This indicates that the count is bearish instead.
A decrease below the June 19 low of $13.71 (red line) would suggest that the count is bearish, while an increase above the Aug 8 high of $30.39 (green line) would confirm that the count is bullish.
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