Avalanche (AVAX) Faces Potential 60% Price Correction Amid Bearish Patterns and Major Sell-Offs

  • Avalanche (AVAX) has recently experienced a significant downturn, hitting its lowest point in six months.
  • Over the past month, AVAX has declined by 25%, with a 14.7% drop in just the past week and a further 0.3% decrease in the last 24 hours.
  • The current trading price for AVAX now stands at $24.23, indicating a sharp reversal from its previous positive performance.

Avalanche (AVAX) tumbles to a six-month low amid potential for further decline; analysts highlight key technical indicators and market influences. Explore the latest trends in the cryptocurrency market and discover possible future scenarios for AVAX.

Additional 60% Correction Ahead For AVAX, But Why?

The cryptocurrency community has taken note of AVAX’s persistent decline. Technical analysis suggests that AVAX could face further challenges.

Crypto analyst Patel indicates that current chart patterns are forecasting an additional 40% to 60% drop in AVAX’s value. The head-and-shoulder formation on the chart is a classic warning sign for impending price drops.

Patel highlights the significance of the head-and-shoulder pattern on the AVAX chart, pointing out that the neckline support has already been breached. This breach suggests a continued bearish trend, possibly driving the price down to $19 and even $13.

📉 AVAX/USDT Chart Analysis:

$AVAX is forming a head & shoulder pattern. The NECK LINE support is broken, indicating a bearish trend.

Expecting a 40%-60% downside move. Targets: $19 & $13.

Not saying don’t open long scalps, but use strict stop loss. Trade wisely! #Crypto…

In light of these predictions, Patel advises traders and investors to exercise caution, especially for those considering long positions. He stresses the need for strict stop-loss measures to navigate the expected volatility.

External Influences And Optimistic Counterpoints

Adding to AVAX’s market troubles is the movement of large volumes of AVAX by significant holders to major exchanges.

On-chain investigator ZachXBT has attributed AVAX’s declining value to substantial transactions by a noteworthy entity identified as ‘0x32…4f30.’

This particular entity has reportedly transferred around 1.96 million AVAX, worth approximately $54.2 million, to major exchanges including Coinbase, Binance, and Gate, alongside transfers via THORChain.

Such large transactions typically suggest a bearish sentiment among major holders, and if this trend persists, it may lead to further decline.

Despite the current downturn in AVAX’s performance, some analysts remain positive about the broader altcoin market. Analyst Captain Faibik views the current correction period as a critical investment opportunity for those thinking long-term.

Faibik notes that the altcoin sector has shown resilience and growth over recent months and believes it is merely undergoing necessary corrections following substantial gains.

He predicts a robust recovery in the latter half of the year and advises investors to “buy the dips” in anticipation of a bullish surge in Q3 and Q4.

Q3 & Q4 gonna be EPIC for the Altcoins..!!

I understand that this period is very Challenging for Altcoin Holders, given that altcoins are down 40-50%.

However, let’s not Forget that we have made Significant gains over the last 7-8 Months (since October 2023).

Conclusion

AVAX’s recent market performance highlights the importance of thorough technical analysis and cautious trading strategies. While the bearish outlook suggests further declines, opportunities still exist for strategic long-term investments. As market dynamics continue to evolve, staying informed and vigilant will be crucial for navigating the cryptocurrency landscape.

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Lucien Renard
Lucien Renardhttps://en.coinotag.com/
Lucien Renard is a 24-year-old writer specializing in cryptocurrency analysis and price action. With a focus on technical analysis, Lucien provides valuable insights into market trends and potential opportunities for investors.
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