Avalanche (AVAX) continues its downward trend as it breaks through a critical short-term support level, heightening concerns among traders and analysts about deeper losses in the near future.
AVAX Price Action and Market Context
AVAX declined by 3.67% over the past 24 hours, falling from $21.56 to $20.89, and is currently trading near $20.04. The drop came amid increased trading volume, coinciding with Bitcoin’s 1.1% pullback, which exerted additional pressure across altcoin markets.
The decisive breakdown occurred at the $21.05 support level, a price zone previously holding firm against intraday volatility. Once breached, AVAX moved quickly toward lower support levels, confirming strong bearish momentum.
Technical Breakdown: Signals Point to More Weakness
Technical analysis highlights the following:
- AVAX has formed a descending channel pattern, marked by lower highs and lower lows within the past 24 hours.
- Strong resistance developed at $21.64, a zone where selling pressure repeatedly halted recovery attempts.
- The break of $21.05 led to increased volume, with 50,477 units traded during the most active session.
- A double bottom briefly formed at $20.85, suggesting temporary support; however, bulls failed to hold momentum beyond $21.03.
- Immediate support lies at $20.85, and if this level breaks, the next downside target is $20.50.
The total price range for the session was $0.79 (3.67%), further emphasizing the heightened volatility as traders react to key technical breaches.
Bearish Sentiment Gains Ground
The breakdown of the $21.05 level is seen as a confirmation of the current bearish trend in AVAX, with potential for further downside. If AVAX closes below $20.85 on sustained volume, analysts expect it to test $20.50 or even lower zones if broader market sentiment weakens.
With the crypto market still reacting to macroeconomic trends and regulatory developments, AVAX remains vulnerable to Bitcoin price movements and overall risk sentiment.
Conclusion: Short-Term Caution Warranted
Traders should monitor the $20.85 and $20.50 levels closely, as a break below these could signal extended downside for AVAX. While short-term rallies may occur, the broader trend remains bearish unless key resistance levels above $21.64 are reclaimed.
AVAX’s technical structure currently favors sellers, and any bullish reversal will need to overcome strong resistance and negative momentum.