Avalanche has seen an impressive 25% surge since Wednesday, fueled by the Federal Reserve’s announcement of a 50 basis point interest rate cut. This has pushed AVAX to a critical resistance level, which is likely to shape its price action in the coming weeks. Currently trading near $28, the token is testing an important supply zone that has analysts and investors paying close attention to its next move.
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Many market participants are optimistic, projecting that a break above this resistance could pave the way for an aggressive rise in the price of AVAX. This would likely push AVAX in a new uptrend, potentially leading to new highs and even a 50% increase for the token. However, if Avalanche fails to break above this level, it risks a pullback that could see prices retest previous support levels.
Analysts are highlighting this moment as crucial in determining AVAX’s market direction, as broader sentiment on cryptocurrencies has turned more bullish following the Federal Reserve’s recent decision. With trading volume and investor interest increasing, the coming days will be key in determining whether Avalanche can sustain its momentum or face a short-term correction.
Main supply levels for avalanche testing
Avalanche has been one of the best-performing altcoins in recent days, showing impressive strength amid a broader market rally. This recent momentum could be just the beginning of a more significant move for AVAX, as analysts and investors are projecting even bigger gains if the token continues to break through key supply levels.
One of the most respected figures in the crypto space, Carl Runefelt, has shared an optimistic opinion Avalanche technical analysis instating that AVAX has broken out of a falling wedge pattern, a classic indicator of bullish price action.
According to his analysis, AVAX has successfully retested the wedge and is now targeting medium-term price levels. Runefelt’s price targets for AVAX are $28, $33, $41.30, and $54, each representing crucial supply zones that the token needs to overcome to continue its upward trajectory. If AVAX reaches $41.30, it will reflect a 50% increase from its current price, marking significant progress.
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Currently, Avalanche has formed a new high, confirming its strength. While the price may consolidate before taking the next step, many investors believe that this consolidation could be a springboard for a bigger move higher.
With broader market sentiment turning positive following the Federal Reserve’s recent interest rate cut, AVAX is well-positioned to continue its rise, especially as more investors look to capitalize on its strong technical setup.
If AVAX can maintain this momentum, it could potentially lead to significant gains in the medium term.
Price levels to watch
AVAX is currently trading at $27.39 after testing the 200 daily exponential moving average (EMA) at $28.66. The token has experienced an impressive 40% surge since the beginning of September, bringing it closer to crucial supply levels that are likely to shape price action in the coming weeks.
For bulls to maintain momentum and extend the rally, AVAX needs to break the $28 resistance and reclaim the 1D 200 EMA as support. Doing so would signal a more sustained uptrend and position AVAX for further gains.
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However, if the price struggles to hold above the $25 mark, a deeper correction could occur, bringing bearish pressure in the short term. Despite this risk, there is still a possibility that AVAX could consolidate between $25 and $28, giving the token room to gather strength for a more significant increase in the near future. Investors are closely monitoring these levels as the market searches for direction.
Featured image of Dall-E, chart from TradingView
