Following an initial 8% uptick, Avalanche [AVAX] experienced a price decline over the last 24 hours driven by bearish sentiment. However, this recent downward movement may signal the start of a potential bullish rally.
Positive Momentum for Avalanche
Investors faced some challenges over the past day as the token saw a drop of more than 3%, with its current trading price at $27.16 and a market capitalization exceeding $11 billion.
Despite the decline, data from IntoTheBlock revealed that 50% of Avalanche holding addresses remained profitable, hinting at a potential shift in trend as the token tests its support level post a breakout from a bullish pattern.
Renowned crypto analyst, Captain Faibik, shared insights on Twitter, highlighting AVAX’s breakout from a bullish falling wedge pattern that emerged in November 2023. Following this revelation, the token’s price has been consolidating within this pattern.
The recent price dip could be a revalidation of the pattern’s support. If the token successfully tests this level, investors could anticipate a surge of over 100% with a possibility of revisiting its March peak in the near future.
Anticipated Growth for AVAX
CryptoCrypto conducted an examination of Avalanche’s on-chain data to identify metrics indicating a potential 100% price increase. The analysis revealed a rise in Avalanche’s weighted sentiment, signaling strong bullish sentiment surrounding the token.
Moreover, an increase in social volume indicated a growing popularity for the token in the crypto community.
Despite this positive sentiment, the fear and greed index for Avalanche currently stands at 71%, suggesting a market sentiment leaning towards “greed.” This level typically signifies an increased risk of a price correction.
To gain better insights into AVAX’s future trajectory, an analysis of its daily chart was performed, highlighting the ongoing test of a crucial support level along with a promising bullish advantage displayed by Avalanche’s MACD indicator.
Furthermore, the Chaikin Money Flow (CMF) showed a significant uptick, hinting at a potential successful test of the support level and a subsequent upward movement in the days ahead.
If these conditions persist, AVAX could target an initial milestone of $32, with further gains potentially leading the token to revisit its previous highs from March.