Avalanche price analysis 24 Nov: Is a drop to $100 possible?

Avalanche may enter a corrective phase

Avalanche (AVAX) Cryptocurrency Symbol with stock-market diagram in glowing green color background.Price rise,high profit,going up digital and technology concept                                 
Will Avalanche (AVAX) drop to $100? – Photo: Shutterstock
                                

Avalanche (AVAX) has been among the best-performing major altcoins in 2021. It had risen by almost 40-fold year-to-date when it hit an all-time high of $146.22 on 21 November.

The AVAX token picked up momentum after the announcement of a partnership between Ava Labs – the team supporting the development of the Avalanche blockchain – and one of the big four accounting firms, Deloitte. The stated partnership plan is “to build more efficient disaster relief platforms using the Avalanche blockchain”.

Although the token surged after this news, Matt Hougan, chief investment officer at Bitwise Asset Management, said: “There is nothing specific about the Deloitte deal that is transformative to Avalanche. It is a signal that Avalanche may have the right ingredients to compete with Ethereum and other all-purpose blockchains long term,” CNBC reported.

Avalanche claims it can conduct more than 4,500 transactions per second, against 14 transactions per second by Ethereum.

Lower costs and fast transaction speeds may be two of the reasons that have boosted decentralised finance (DeFi) adoption of the Avalanche blockchain. 

According to the DeFi Llama, the total value of funds locked in the Avalanche DeFi projects is $12.5bn.

Could AVAX go up after the current correction or has it topped out? Read the AVAX price analysis to find out what the charts suggest.

Avalanche price technical analysis: weekly chart

Avalanche technical analysis weekly chart
Avalanche price technical analysis: weekly chart – Credit: Currency.com

AVAX’s price has rallied vertically in the past few weeks. Usually, vertical rallies are unsustainable and are followed by a corrective phase or consolidation.

The AVAX/USD pair is currently in a pullback, which could find support at the 38.2% Fibonacci retracement level at $100.88. If the price rebounds off this level, it will indicate that the sentiment remains positive and traders are buying the dips.

The bulls will then again try to resume the uptrend. If they push and sustain the price above the all-time high, the upward move may start its northward march towards $175.

On the contrary, if the price rebounds off $100.88 but turns down from the all-time high, the pair could consolidate between these two levels for a few days.

The bears will have to pull the price below $100.88 to signal a change in the short-term trend. The pair could then drop to the 61.8% Fibonacci retracement level of $83.66.

Avalanche technical analysis: daily chart

Avalanche technical analysis daily chart
Avalanche price technical analysis: daily chart – Credit: Currency.com

AVAX’s price is correcting in a strong uptrend. The first important support on the downside is the uptrend line. If the price rebounds off this support, the bulls will make one more attempt to resume the upward move.

The pair could pick up momentum on a break and close above $135. That could indicate the resumption of the next leg of the uptrend.

Conversely, if the price continues lower and breaks below the uptrend line, it will indicate that traders may be rushing to the exit. A break and close below the uptrend line could open the doors for a further decline to the support zone at $108 to $100.

Avalanche: Buy or sell at current levels?

Avalanche’s price analysis shows that traders are booking profits after the sharp rally of the past few days. A break below the uptrend line could intensify selling and the price may drop to the support zone at $108 to $100.

Alternatively, a strong rebound off the uptrend line could keep the uptrend intact.

Whatever the outcome might be, your decision to trade depends on your attitude to risk, your expertise in this market, the spread of your investment portfolio and how comfortable you are about losing money. This analysis does not constitute investment advice. It’s important to make your own analysis before deciding to invest. You should never invest more than you can afford to lose.

Further reading

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