Cryptocurrencies

Avalanche Price pumps to record high as Ethereum-killer bets Grow

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Written By: Elliott Laybourne
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    Summary:
  • The Avalanche price exploded 80% in the last week, to a new all-time high, on hopes the blockchain will eat into Ethereum's market share.

The Avalanche price exploded 80% in the last week, to a new all-time high, on hopes the blockchain will eat into Ethereum’s market share. On Monday, Avalanche’s native Token AVAX reached a personal best of $151.75, lifting the layer-1 project’s market cap to over $32 billion, ranking it the 10th-largest cryptocurrency ahead of Dogecoin (DOGE).

Ethereum’s high gas fees and scalability issues have given rise to the so-called Ethereum-killers. Like Solana (SOL) and Cardano (ADA), Avalanche is a blockchain that threatens Ethereum’s position. Cardano and Solana experienced parabolic rallies to new highs in August and September before collapsing 44% and 37%, respectively. But whilst ADA failed to bounce, SOL went on to reach a new ATH earlier this month.

Now it appears it’s AVAX’s time to shine. Despite the general malaise in the market, Avalanche is one of the few blue-chip cryptos attracting considerable interest. However, the recent appreciation is similar to those of its rivals earlier this year, which could mean it’s vulnerable to a correction of a similar magnitude.

AVAX Price Analysis

The daily chart shows the avalanche price accelerated after breaking out of a rising trend channel. The top of the parallel pattern at $113.50 is now the first support level. The impulse higher stretched to $151.75 before retracing around 12.5% to the current $133 level.

As a result of the rapid expansion, the Stochastic RSI and the MACD show signs of over-extension, suggesting the price needs a period of consolidation before moving higher. However, as long as AVAX holds trend support at $113.50, the outlook is constructive.

On the other hand, a close below $113.50 could trigger an extension towards the bottom of the trend channel at $73.00. On that basis, my current view is ‘very cautiously’ bullish above $113.50. Therefore, a close below trend support on the daily candle will invalidate the ‘very cautious’ bullish thesis.

Avalanche Price Chart (daily)

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This post was last modified on Nov 23, 2021, 05:04 GMT 05:04

Written By: Elliott Laybourne

Elliott Laybourne is an accomplished Hedge Fund sales and Investment bank trading specialist. Elliott also started a successful Base Metals Brokerage business in partnership with ABN AMRO clearing bank. He worked on the open outcry trading floors at the London International Financial Futures Exchange 'LIFFE' and the London Metal Exchange 'LME.' He also provided research and execution services for Goldman Sachs, JP Morgan, Credit Suisse, Schroders Asset Management, and Pennsylvania State Public School Employees Retirement System, as amongst others. Today, he focuses on providing trading consultancy and business development services for family office and brokerage clientele.

Published by
Written By: Elliott Laybourne