The AVAX price dropped to a one-week low of $57.24 on Wednesday before recovering from significant trend support. Avalanche (AVAX) is trading firmer this morning and changing hands at $62.62 (+1.62%). The AVAX token is down around 6% in October, although +1,800% year-to-date. Avalanche’s market cap is just north of $13.5 billion, making it the 14th most valuable Crypto asset, ahead of Chainlink (LINK).
Like most top-ranking altcoins, AVAX suffered material losses on Wednesday as Bitcoin’s drop below $60k spurred market-wide deleveraging. Avalanche was performing well at the start of the day and looked set to continue its uphill march towards a new all-time high. However, a sudden wave of selling forced Bitcoin to an intraday low of $58,100. As a result, the AVAX price reversed the early gains, losing as much as 15% at one stage before stabilizing above $60. This morning, BTC is hovering around $58,800, which is encouraging some cautious dip-buying of altcoins. However, buyers will likely be skittish and prone to liquidation after yesterday’s setback. For now, Avalanche appears to have absorbed the selling, and the technicals remain constructive as long as the AVAX price holds above yesterday’s low.
The daily chart shows AVAX reversed higher from trend support on Wednesday. I consider the successful test of the descending trendline, now around $57.00, a bullish development. In September, a similar scenario was the starting point of a two-week, 70% rally to the $80.99 ATH. Therefore, the trend at $57.00 is a significant support level, and as long as Avalanche respects the trendline, I expect it to trade with a bullish tone. The first upside target is $73, which, if cleared, brings the all-time high into focus.
If AVAX loses trend support, an extension to the 12th of October low of $50.76 is probable. And below that, the 7th of September low of $30 is a potential target to the south.
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This post was last modified on %s = human-readable time difference 03:20