Volume Action Hints Avalanche Price To Prolong Bullish Recovery; Is $25 Within Reach?

During the first half of February, the Avalanche coin price witnessed a minor correction to the local support of $17.5. This short counter-trend move eased off the excessive buying in the market, allowing it to recuperate the bullish momentum. Thus, the coin price recently bounced back from mentioned support suggesting the market sentiment is getting shifted from selling on rallies to buying on dips.

Key Points:

• This V-shaped recovery from $17.5, indicates buyers’ confidence to reach high levels and increased possibility of uptrend continuation.
• As per volume action, the Avalanche coin is going through a temporary correction.
• The intraday trading volume in Avalanche coin is $447.2 Million, indicating a 33.4% loss.

Source- Tradingview

On February 14th, the Avalanche coin price initiated a V-shaped recovery from the local support of $17.5. Within a fortnight, the AVAX price surged 24.6% and reached the last swing high resistance of $21.8. However, with the ongoing uncertainty in the market, the coin price struggled to surpass this weekly barrier and showed the formation of a famous bearish candle pattern called the evening star.

As of now, the Avalanche coin price tumbled 3.34% on the intraday level and reached the current price of $20.6. If the selling pressure persists, the coin holders can mark $19.5 and $17.5 as strong support that could assist buyers in replenishing bullish momentum. 

However, any further downfall will weaken the possibility of higher recovery.

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Having said that, whenever the AVAX price has approached the $21.7 mark, there’s an increase in volume activity, whereas, there’s an evident volume drop whenever the prices turn down from this resistance. This volume action indicates the traders are more committed to buying orders, which increases the possibility of a bullish reversal from $19.5 or $17.5 supports.

Technical Indicators

RSI Indicator: While the price action moves sideways, the daily RSI slope plummets lower indicating weakness in bullish momentum. This bearish divergence suggests the price may consolidate for a few more sessions before the actual breakout.

Trend-Based Fibonacci Extension: This indicator is applied to a price chart by identifying a trend and using the Fibonacci ratios to project potential price levels in the direction of the trend. Thus, as per this indicator, a bullish breakout from $21.8 could lead the price to the following targets $22.5, $23.8, or $25.86.

Avalanche Coin Price Intraday Levels-

• Spot rate: $20.2
• Trend: Bearish
• Volatility: Medium
• Resistance levels: $21.7 and $23.8
• Support levels: $19.450 and $17.5