Avalanche (AVAX) Retests Weekly Support At $22.89, Bounces 9%, And Trades 1% Higher At $25.45 On Tuesday

Technical analysis shows that price shows potential for an upside move

Avalanche price displayed a remarkable recovery on Tuesday, surging by 9% and trading 1% higher at $25.45. The technical analysis of AVAX price suggests potential for an upside move.

Avalanche price retested its crucial weekly support level of $22.89 on July 5 and surged by 9% on July 6. As of the latest update, it is trading 1% higher at $25.45 on Tuesday.

Moreover, on the daily chart, the formation of a lower low on July 5 is contrasting with the Relative Strength Index’s higher highs during the same period. This development is termed a bullish divergence and often leads to the reversal of the trend or a short-term rally.

If the daily candle closes above the immediate resistance at $27.61, it could extend an additional 15% rally to retest its daily resistance level of $31.36. This resistance level also coincides with the 50% price retracement level between $41.80 and $21.89.

On the other hand, if the price produces a daily candlestick close below $21.89, it would produce a lower low in the daily time frame. Such a development would give rise to a bearish market structure. This change in market structure would invalidate the bullish thesis and catalyze an 11% crash in the Avalanche’s price to retest its low of $19.47 on November 28, 2023.

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