Avalanche (AVAX) Rumbles With 18% Gain – Is A Trend Reversal On The Horizon?

Christian Encila

Last Updated: June 26, 2023 10:18 am

3 mins read

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Avalanche (AVAX) recently experienced a breakout, successfully overcoming a major obstacle at $13. This particular hurdle had proven to be a significant challenge for AVAX bulls in the preceding weeks, hampering their upward momentum.

The surge in AVAX’s performance can be attributed to multiple factors, one of which is the increasing demand for the wrapped version of Bitcoin (BTC) on the Avalanche network.

As Bitcoin prices rose, more users sought to utilize the wrapped BTC on Avalanche, contributing to the network’s growing user base. Will AVAX’s upward momentum continue?

Avalanche Price Shows Signs Of Exhaustion

The price of AVAX, currently standing at $13.37 according to CoinGecko, has demonstrated a 2.7% rally within the past 24 hours, accompanied by an impressive seven-day surge of 18.0%. However, a closer examination reveals that AVAX’s recent upward momentum may be losing steam.

Source: Coingecko

Between June 10 and 25, AVAX gained a substantial 40% and established a price range spanning from $9.65 to $14.25. Despite approaching the upper boundary of this range, indications of exhaustion are becoming increasingly evident.

Notably, from June 21 to 25, AVAX’s price formed three distinct higher highs. However, during the same period, the AVAX’s Relative Strength Index (RSI) and Awesome Oscillator (AO) formed lower highs.

AVAX 7-day price climb. Source: CoinMarketCap

This disparity, known as “bearish divergence,” suggests that the momentum behind AVAX’s recent ascent may be waning. In technical analysis, this formation typically serves as a sell signal and often precedes a correction in the underlying asset.

Source: TradingView

Bitcoin’s Influence May Shape AVAX Future

Meanwhile, the potential resumption of bullishness in Bitcoin’s price at the beginning of a new week could present a challenging scenario for bears.

The interplay between Bitcoin’s movement and AVAX’s price trajectory plays a pivotal role in determining the future direction of AVAX.

As one of the most dominant cryptocurrencies in the market, Bitcoin serves as a major influencer for the overall sentiment and trends within the crypto space. Its movements often set the tone for the entire market, and AVAX, being an altcoin, is not immune to this influence.

Avalanche market cap currently at $4.6 billion. Chart: TradingView.com

Bitcoin’s price movements have historically exhibited a strong correlation with the wider cryptocurrency market. When Bitcoin experiences significant price fluctuations, it tends to trigger a ripple effect that impacts other cryptocurrencies, including AVAX.

This correlation stems from various factors, such as Bitcoin’s status as a benchmark cryptocurrency, its high trading volume, and its position as a store of value for many investors.

As investors and enthusiasts closely monitor these developments, the question of whether AVAX can overcome the sell signals and embark on a renewed ascent lingers in the air.

Featured image from Getty Images

Christian Encila

They say journalists never truly clock out. But for Christian, that's not just a metaphor, it's a lifestyle. By day, he navigates the ever-shifting tides of the cryptocurrency market, wielding words like a seasoned editor and crafting articles that decipher the jargon for the masses. When the PC goes on hibernate mode, however, his pursuits take a more mechanical (and sometimes philosophical) turn.

Christian's journey with the written word began long before the age of Bitcoin. In the hallowed halls of academia, he honed his craft as a feature writer for his college paper. This early love for storytelling paved the way for a successful stint as an editor at a data engineering firm, where his first-month essay win funded a months-long supply of doggie and kitty treats – a testament to his dedication to his furry companions (more on that later).

Christian then roamed the world of journalism, working at newspapers in Canada and even South Korea. He finally settled down at a local news giant in his hometown in the Philippines for a decade, becoming a total news junkie. But then, something new caught his eye: cryptocurrency. It was like a treasure hunt mixed with storytelling - right up his alley!

So, he landed a killer gig at NewsBTC, where he's one of the go-to guys for all things crypto. He breaks down this confusing stuff into bite-sized pieces, making it easy for anyone to understand (he salutes his management team for teaching him this skill).

Think Christian's all work and no play? Not a chance! When he's not at his computer, you'll find him indulging his passion for motorbikes. A true gearhead, Christian loves tinkering with his bike and savoring the joy of the open road on his 320-cc Yamaha R3. Once a speed demon who hit 120mph (a feat he vowed never to repeat), he now prefers leisurely rides along the coast, enjoying the wind in his thinning hair.

Speaking of chill, Christian's got a crew of furry friends waiting for him at home. Two cats and a dog. He swears cats are way smarter than dogs (sorry, Grizzly), but he adores them all anyway. Apparently, watching his pets just chillin’ helps him analyze and write meticulously formatted articles even better.

Here's the thing about this guy: He works a lot, but he keeps himself fueled by enough coffee to make it through the day - and some seriously delicious (Filipino) food. He says a delectable meal is the secret ingredient to a killer article. And after a long day of crypto crusading, he unwinds with some rum (mixed with milk) while watching slapstick movies.

Looking ahead, Christian sees a bright future with NewsBTC. He says he sees himself privileged to be part of an awesome organization, sharing his expertise and passion with a community he values, and fellow editors - and bosses - he deeply respects.

So, the next time you tread into the world of cryptocurrency, remember the man behind the words – the crypto crusader, the grease monkey, and the feline philosopher, all rolled into one.

Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.