Avalanche (AVAX) – Aims to brighten the medium-term technical picturePosted on Sunday, March 20 2022 at 8:20 pm GMT+0000
Avalanche (AVAX) bounced aggressively near the February 24th low and climbed beyond the descending trendline drawn from the November ATH before hitting a minor snag around the March 3rd inside swing high.
The confirmation of a higher bottom in February is providing some hope for a meaningful positive change in the technical picture, something also being sponsored by the near completion of a bullish intersection between the 20- and 50-day exponential moving averages.
Momentum oscillators, on the other side, are painting a picture where the positive impetus is gaining traction. The MACD continues to gain momentum beyond its signal line in the positive region and the IMI is ramping up to reach the overbought zone.
However, for the medium-term outlook to brighten, the price will need to overcome the February 17th peak at 98.77. Such a move will snap the last 5-month negative structure, fueling the rally initially towards the 161.8% Fibonacci extension level of the last down-leg at 119.95. Triumphing over this border, the price will then challenge the December 23rd peak at 132.00.
On the contrary, if positive impetus wanes astoundingly, the descending trendline together with the exponential moving averages will likely step in and try to delay a fresh test of the 64.50 level, marked as the February 24th low. Some distance lower, the January 22nd bottom at 53.16 will act as the last line of defense against the continuation of the broad downtrend.
To summarize, Avalanche seems to be facing a fading medium-term bearish bias. Yet only a climb beyond 98.77 will confirm that view while a drop below the descending trendline will reject it.