- AVAX broke through a crucial support level recently and is now at risk of making lower lows.
- A massive AVAX sale occurred within the past 24 hours, which accelerated the decline.
Avalanche’s [AVAX] A drop of 7.16 % in the last week will likely continue due to a bearish trend on the charts and large liquidity outflows.
In the last 24-hours, altcoins experienced a drop of 4.60 %. Analysis suggests that this could only be temporary as it may just be a correction before a new leg lower.
AMBCrypto analyses the price movement of this asset in light of the growing sentiment to sell.
AVAX risk increases with liquidation withdrawal
AVAX has seen a large outflow of cash at the time this article was written. The sentiment has turned negative, in contrast to the bullish forecast for this project.
Artemis’ data indicates that AVAX was removed from the supply chain in a net amount of $3.9 million over the course of the previous 24 hours.
Source: Artemis
To avoid more losses, investors may be moving to safer assets classes such as stablecoins.
AVAX broke a neckline at $22.87 which had been expected to serve as the catalyst for an important rally. AVAX did not do this and formed the classic bearish pattern of a head and shoulders.
This pattern typically leads to a massive price drop once the support level is breached—a move AVAX has played out perfectly.
AVAX’s price could drop to $14.40 – a decrease of 27.46% from the current level.
TradingView
AMBCrypto has conducted additional analysis on AVAX’s recent upward trend to see if a continuation of the bearish trend or an upswing are imminent.
The edge of the bearish continue
AMBCrypto has confirmed the likelihood of a continuation in the bearish direction using technical indicators such as Relative Strength Index and Bull Bear Power.
The RSI had been seen to be making gradual gains on an upward trend at the time of the analysis. This type of motion usually indicates an imminent breakdown. This would accelerate a downward spiral.
TradingView
AMBCrypto analysed the Bull Bear Power to confirm the possibility of a drop. The result was a histogram that showed a downward trend. This indicates that bears—sellers—are in control.
If the divergence persists, a fall is likely.
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Source: ambcrypto.com
