Disclaimer: The information presented does not constitute financial, investment, trading or other types of advice and is the opinion of the author only
- A trend reversal might be possible if the $10.86 support holds
- AVAX bulls may target immediate resistance at $11.39
Avalanche [AVAX] It fell more than 25% from a high of $14.14 on Dec 13 to a low of $10.54 on Dec 30. However, AVAX broke above $10.73 after Bitcoin [BTC] It exceeded 16.49 thousand dollars.
Read avalanches [AVAX] predict the price 2023-24
If BTC remains bullish and moves towards $17,000, AVAX could target immediate resistance at $11.39, offering a potential gain of more than 4%.
At press time, AVAX is trading at $10.93, and technical indicators are indicating that the uptrend may continue.
Will the $10.86 support hold?
The ongoing downtrend of Avax found a temporary halt at $10.86. But is the support strong enough to prevent the bears from cutting AVAX prices?
Technical indicators suggest that support can hold. In particular, the Relative Strength Index (RSI) reversed after falling near the oversold zone. This showed that although the buying pressure has eased, it has recovered to some extent.
On Balance Volume (OBV) also increased, indicating an increase in trading volume, which helped restore buying pressure.
In addition, Chaikin Money Flow (CMF) crossed above the zero line, indicating a bullish trend reversal.
Therefore, AVAX could retest or break the previous support at $11.39, which represents an increase of 4% from the $10.86 level. Thus, long positions can gain more than 4% if the bulls maintain momentum.
However, a break below $10.63 would violate the bullish expectations mentioned above. Such a bearish move could stabilize at $10.23 or $9.65, giving bears a target to sell.
So investors should look at the Money Flow Index (MFI). An MFI break above the intermediate range of 50 could indicate a strong bullish momentum that could retest $11.39 or surpass $11.39.
How do You can get many AVAX for $1?
AVAX development activity declined during the fourth quarter, but demand in the derivatives market fluctuated
AVAX development activity fluctuated during the fourth quarter of 2022. Development activity increased steadily in October but declined at the end of the month, with a significant uptick in the second half of November.
In December, developmental activity increased sharply but peaked in the first half of the year and then declined steadily. Prices correlated strongly with development activity throughout the period.
At the time of publication, development activity is at an all-time low, as has AVAX. Could this undermine the price swing?
However, investor confidence in the asset has improved, as has demand in the derivatives market, as evidenced by the improvement in weighted sentiment and Binance funding rates.
Improving morale could pump AVAX if its development activity remains flat. Therefore, investors should keep an eye on the performance of BTC and the general sentiment of Avax as the new year approaches.