- The daily chart of AVAX has turned green after a one-month price decline.
- A few indicators point to a successful break above the falling wedge pattern.
After a month of double-digit price declines, avalanche [AVAX] finally managed to paint its daily chart green. The good news was that the token’s price was actually consolidating inside a pattern, which caused the price to drop.
However, he was on the verge of breaking away, which could trigger a massive rally.
Avalanche Bull Model
CoinMarketCap data AVAX price has dropped by more than 18% in the last month. But the last 24 hours have been in favor of investors, with the token price increasing by more than 1%.
At the time of writing, AVAX was trading at $26.15 with a market cap of over $10 billion, making it the 13th largest crypto.
AMBCrypto’s analysis of IntoTheBlock data revealed that long-term holders’ confidence in AVX was on the rise. This was as the number of addresses holding AVAX for over a year increased, suggesting that investors were expecting AVAX to skyrocket.
Source: IntoTheBlock
This could indeed be true, as a bullish pattern has emerged on the token’s chart.
Captain Faibik, a popular crypto analyst, recently published a tweet revealing a bullish falling wedge pattern. The token’s price entered the pattern earlier this year and has since consolidated within it.
At press time, it seemed like Avalanche was finally gearing up for a breakout. If that happens, investors could then see a 200% surge. In fact, the price rally could also put AVAX in the top 10 cryptocurrencies by market cap.
Source: X
Is a bullish rally possible?
AMBCrypto then planned to take a closer look at Avalanche’s on-chain data to gain insight. According to our analysis of Santiment’s data, AVAX’s weighted sentiment remained in the negative zone.
This means that bearish sentiment around the token was dominant in the market. However, its funding rate saw a drop on July 14.
Typically, prices tend to move in the opposite direction to the funding rate, suggesting a price rally that could lead to a break above the bullish pattern.
Source: Santiment
The MACD technical indicator has also shown a bullish trend in the market. Additionally, AVAX’s Relative Strength Index (RSI) has registered an increase, suggesting that the token is likely to start a bullish rally.
However, the Chaikin Money Flow (CMF) suggested otherwise as it moved south.
Source: TradingView
Realistic or not, here it is AVAX Market Cap in BTC
If the bulls start a rally, AVAX could first reach $27.9 as liquidation would increase at this level. A break above this level could push Avalanche to $30 this week.
However, if bears dominate, the token price could drop to $24.
Source: Hyblock Capital