Nearly one week ago, Avalanche rebounded from the ascending support that contributed to its wedge formation. That opened the breakout possibilities amidst a massive rally. Meanwhile, AVAX achieved the goal of overcoming its lateral resistance level. However, the uptrend appeared limited, considering the subsequent pullback.
While publishing this post, Avalanche changed hands at $23.59, following a slight drop from the $26.30 weekly high. The minor correction mimicked the overall market situation. But our question is, will AVAX continue its retracements or embark on upsides?
Avalanche’s breakout translated to a lucrative signal for AVAX bulls as it confirmed the altcoin surpassed a crucial resistance level. We may have to evaluate what triggered the latest price moves to gauge the asset’s upcoming action.
AVAX’s current retracement emerged after its MFI (Money Flow Index) dipped into the distribution territory. The broad-based selling momentum surge over the past two days saw bulls cooling following the recent attack. That canceled their chance to stretch a bit high inside the overbought zone.
Fall or Flight?
The primary observation about the ongoing correction is it remained limited, indicating that most Avalanche holders have resorted to HODLing. That could reflect their anticipation of massive bullish recoveries following June’s bottoms. Impressive network growth by Avalanche could have increased their expectations for extended upsides.
Avalanche’s attractive growth comes after the enormous development activity over the past four weeks. That could have encouraged immense volumes into AVAX, triggering the rally, plus the potential to keep strong price movements amidst a pullback. Avalanche saw impressive network developments in July. For instance, it saw a top-notch performance in its NFT business, recording remarkable trade volumes.
Avalanche recorded massive NFT trade volumes surge over the past two weeks. That could have catalyzed the substantial demand for the altcoin.
An unenthusiastic sell-off confirms sentiments still favor bulls. Strong growth and healthy utility also support AVAX’s impressive upside. Nevertheless, traders should consider near-term headwinds that could halt quick recoveries for the market. It remains interesting to witness upcoming trends within the crypto space. Stay tuned for the latest developments in that industry.