Avalanche (Avax) is beginning to flash signs of a potential trend reversal as a clear double-bottom pattern is formed on the weekly chart. The build strength of the price action makes the Bulls aim for the next important Fibonacci resistance zone.
Double bottom strengthening: Can I maintain Fibonacci levels?
In a recent analysis of the weekly chart posted to X, the boss of market analysts highlights that the avalanche has now established a solid technical foundation. He noted the emergence of distinct double-bottom formations, often considered reliable inverted signals when confirmed.
According to the boss, if this bullish pattern continues to occur, traders should be aware of the resistance zones marked by yellow lines based on Fibonacci’s retracement level.
The boss emphasized that the most important level to see is the horizontal resistance, represented by the green lines. He explained that a powerful weekly nearer beyond this area could serve as a technical catalyst, potentially unleashing Avax rise in the short term.
Charts of key technical indicators
Sharing more technical breakdowns, the boss turned his attention to some key indicators that show avax’s enhanced momentum. One outstanding observation is the MACD on the weekly chart. This is on the threat of bullish crossovers. This is a classic signal that purchasing pressure is gaining strength.
The boss also noted that the relative strength index (RSI) hovered at about 55 just above the midpoint of the neutral zone. This positioning, coupled with its upward tilt, reflects a change in bull’s momentum. If a key indicator continues this upward trajectory, it may reinforce the bullish emotions that have occurred.
Turning to ADX, the boss explained that while it is below the 25 threshold, it is typically used to define a strong trend, but shows progressive signs of reinforcement. He suggested that over 25 moves add weight to bullish cases by confirming the emergence of a more defined upward trend.
Volume was another factor that the boss highlighted in his analysis. He noted that trading volumes have been steadily increasing over the past few weeks. This often means a growing interest and trust among investors. In his view, this rise supports the technical outlook and adds fuel to potential breakout scenarios.
However, my boss issued a note of caution despite the promising setup. He emphasizes that the crypto market is inherently unstable, and in this bullish case, price action must go beyond the main zone of resistance. Traders advise that confirmations from metrics should be monitored closely, and weekly closures are to verify the continuation of the trend.
