Volatility returned strongly to the cryptoasset market in 2023, with the main cryptocurrencies on the market registering large movements in their prices.
With Avalanche (AVAX) it was no different and the crypto asset has been registering large fluctuations in its value this year. The extremely high volatility in the cryptocurrency market is a result of the ongoing banking crisis in the United States, as well as the recovery seen by the market following the release of the Consumer Price Index (CPI).
In the case of AVAX, after failing to break the immediate resistance level at $17.20, the crypto asset recorded a sharp drop, falling close to the critical support level of $14.91 and later recovering its value and staying above of $15.
“By all indications, a decline is to be expected from the altcoin, however, looking at the price indicators, it is clear that the correction was necessary to initiate a sustainable recovery,” said analyst Aaryamann Shrivastava.
AVAX price
Shrivastava points out that the Relative Strength Index (RSI) has seen a rise close to the neutral line at 50.0, whose reversal towards support would indicate a likely rise in price.
Likewise, he points out that the Moving Average Convergence Divergence indicator is still in the early stages of a bullish crossover.
“So, if the bullish narrative plays out, the AVAX price could post a recovery high to $17.20. Reversing this level into a support floor would also push the altcoin above the critical resistance level,” he stated.
For him, a rally above that level would result in the Avalanche rising to a monthly high of $19.60, marking a 25% increase, as well as testing the 200-day Exponential Moving Average (EMA).
“But on the off chance that macroeconomic conditions worsen the market panic, traders and investors can expect further declines. Falling below the critical support level at $14.91 would invalidate the bullish thesis and push the AVAX price towards the December 2022 highs of $13.78.”
