- Avalanche (AVAX) surged 8% to $31.6, breaking out from a falling wedge pattern and signaling a continuation of its bullish trend, with a potential rally to $41.8.
- The Total Value Locked (TVL) in the Avalanche network increased by 38% and Futures Open Interest rose by 46%, indicating strong investor confidence and market engagement.
Amid a reversal from the 50% Fibonacci retracement level, Avalanche (AVAX) has broken out of a falling wedge pattern, signaling a continuation of its prevailing uptrend. Over the weekend, AVAX surged by 8%, reaching a five-week high of $31.6, contrasting with Bitcoin’s modest 0.4% increase. The intraday trading volume for AVAX soared to $495 million, reflecting a 105% gain.
Key Technical Levels and Market Sentiment
The Avalanche price managed to bottom at $21.8 before rallying 45% to trade at $31.4, pushing its market cap to $12.4 billion. The breakout from the falling wedge pattern, which represented a two-month correction, indicates a bullish reversal. The overhead resistance around $33, coinciding with the 200-day Exponential Moving Average (EMA), is a critical level to watch.
Additionally, the Total Value Locked (TVL) in the Avalanche network has surged from $689.5 million to $951.7 million, marking a 38% increase. This rise in TVL, alongside a 46% increase in Futures Open Interest from $173.6 million to $254.1 million, reflects growing investor confidence and trader engagement in the Avalanche ecosystem.
Technical Indicators and Future Outlook
The Exponential Moving Averages (EMAs) show that AVAX has reclaimed the fast-moving 20-day and 50-day EMAs, indicating an initial trend reversal. The Directional Movement Index (DMI) also shows a positive crossover, with the DI+ (blue) slope overtaking the DI- (orange) slope, suggesting that buyers are gaining control.
In the short term, AVAX may experience a minor pullback to test the breached resistance level as potential support. If the wedge pattern breakout holds, AVAX could rally to $41.8, followed by a potential surge to $65.4. The bullish sentiment and technical indicators point towards a promising upward trajectory for Avalanche in the coming weeks.
