Some altcoins are crossing critical thresholds to start neutralizing their bear markets. For instance, the AVAX cryptocurrency of the Avalanche network, backed by its partnership with Amazon Web Services, it would seem to start under the best auspices by covering a large part of the losses caused by the setbacks of FTX. To the point where sellers are starting to worry about a continuation of the bounce.
In a market context in which many investors seem to believe it the hardest part is inflation, now let’s see the latest technical analysis of the prices of the AVAX cryptocurrency from the Avalanche blockchain. This is to give us clues about a possible return of the Altseason.
Weekly Unit Avalanche – $18 in sight
Thanks to inflation that may continue to fall and the partnership with Amazon’s cloud subsidiary, the AVAX token is flying towards the $18 resistance, not far from the 30-week moving average (weekly MM30). Better yet, the latter sees its slope flatten out with the hopes of moving from Phase 4 to Weinstein’s Phase 1. Which would mean that we could potentially see the beginning of a bear market neutralization.
At the same time, the bullish divergences on MACD and RSI are gradually asserting themselves, but are struggling to get back above the zero line and the neutral zone at 50 respectively. the failure of a third wave of correction that would extend below the $11 support could gain momentum. At the risk of the vendors arriving late. they would be forced to adjust their positions.
Assuming a breakout above $18, Prices of the native Avalanche token could project towards the $30 resistance. With technical indicators likely to cross their respective fold lines. Enough to highlight a favorable polarity change around $18 which would become a support.
Conversely, the scenario of a pullback below $18 should not be taken lightly by investors if the market environment reverts to its 2022 biases. In this case, the $11 breakout would pretty much bring us back to the IPO price of the Avalanche blockchain cryptocurrency.
Daily Unit Avalanche – Soon Above 200-Day Moving Average?
Just like the weekly MM30, The 200-day moving average (200 daily MA) is falling to the $18 resistance level. This would support the notion of a bear market in AVAX token prices since its last ATH in November 2021 in loss of momentum. At the same time, the technical indicators have managed to break through their respective folds.
If a RSI in the overbought zone can be a technical hurdle, it doesn’t necessarily have to be when the Avalanche token crosses a descending wedge, a bullish reversal chart pattern. In the event of an ebb that would offset part of yesterday’s candle rally, we would increase our chances of regaining the 200 daily MA and the $18 at the same time.
And as we mentioned in the weekly chart, crossing these key thresholds would allow buyers to regain some control over prices, not to signal the end of the race to the bottom, but to glimpse a neutralization process. Because for the moment we are in a market context that would suggest that things could go smoothly without the slightest pebble in the FED’s shoe.
AVAX – Salespeople in a delicate position?
Ahead of the latest US inflation data released this afternoon, Avalanche token prices appear to be in the starting blocks to clear the $18 resistance. Assuming they break out of the right side of the barrier, it (and cryptocurrencies in general) could continue their early-year rally. To the point that many sellers would find themselves in a delicate position with an AVAX higher than MM30 per week and 200 per day. Otherwise, we risk returning to our starting point, i.e. a return within the descending wedge.
Beyond inflation, next month we will have to keep an eye on the Fed’s intentions. Because since mid-October, investors have been betting heavily on a possible moderation of its monetary policy. But at the same time, the fact that financial conditions have eased significantly could embarrass the US central bank.
Not only does he remain hesitant between a temporary or lasting nature of inflation. But if the second option prevails, then the easing of monetary policy would risk bringing inflation back to the fore. And in this specific case it would no longer be the recession that worries investors, but rather stagflation that would potentially go beyond 2022 and beyond.
As a result, nothing would be certain until the Fed met market expectations. In which case, a flashback of the dollar against the main currencies cannot be ruled out. This would again disrupt the rebounds of the various risky asset classes. And unfortunately, cryptocurrencies would definitely lose their main engine, the liquidity of central banks.
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