- Avalanche broke below critical support, signaling increased selling pressure and bearish momentum.
- Fibonacci levels suggest potential price targets as low as $19.54 if the downtrend continues.
- Traders are watching to see if AVAX can recover or face further losses below $20.
Avalanche has recently made a notable move that caught the attention of traders and analysts alike. According to a detailed analysis by Ali, the cryptocurrency has broken out of a symmetrical triangle, a classic chart pattern known for its potential to signal significant price shifts.
This breakout has paved the way for a possible downswing, with AVAX projected to target levels around $20 or below. With the token trading at $25.96 as of the analysis, the move aligns with broader technical indicators pointing to bearish momentum.
The symmetrical triangle, spanning several trading sessions, compressed AVAX within a range, with resistance around $28.73 and support near $25.50. The breakout below the lower boundary of the triangle has confirmed a bearish continuation pattern.
Fibonacci retracement levels further support this analysis, as AVAX has slipped below the 50% retracement level at $25.50, indicating increased selling pressure. The next key Fibonacci levels are positioned at $24.80 (61.8%) and $23.82 (78.6%), with the 1.618 extension pointing to a potential low of $19.54, underscoring the risk of deeper declines.
Critical Levels and Implications of the Bearish Breakout
The bearish breakout highlights market uncertainty as Avalanche navigates both technical and fundamental challenges. The move below $25.50 reflects a failure to maintain critical support, a signal often indicative of heightened bearish activity.
Traders monitoring this pattern are bracing for further declines, especially as the symmetrical triangle suggests a downside target aligning with the measured move principle, which estimates a drop proportional to the triangle’s widest section. With AVAX already losing its foothold, a test of sub-$20 levels seems increasingly plausible.
Ali’s analysis also draws attention to the broader implications of this breakout. While some traders view this as a short-term opportunity to capitalize on downward momentum, others see it as a reflection of AVAX’s current struggles to regain its footing in a volatile market.
