Avalanche (AVAX) hit a new all-time high of $ 64.90 on September 2, but has been moving down since then.
AVAX is now trying to find support at the previous daily closing high near $ 54.40.
AVAX reaches new all-time high
On August 16, Avalanche broke out of a long-term descending resistance line and hit a high of $ 58.98 on August 24.
It then began moving down within a descending wedge in what is often viewed as a bullish pattern.
AVAX broke out on September 10th, hitting a new all-time high of $ 64.90 two days later.
Since then, however, it has been going down. The decline was preceded by bearish divergences in both RSI and MACD (blue lines).
The main support is at $ 39. This is both a horizontal support area and a level that coincides with the Supertrend support line (green).
Cryptocurrency trader @Altcoinsherpa outlined an avalanche chart and stated that it could keep moving up as long as it closes above the 200-day moving average (MA).
The two-hour chart shows that the USD 39 support area also coincides with the 0.786 fib retracement support level from the recent bullish move. So if AVAX falls behind, this level is likely to provide strong support.
The MACD and RSI have both turned bearish, so it is possible that the current rebound has been corrected and that the lows have not yet been reached.
If so, AVAX could rise towards the $ 56 area and validate it as a resistance before falling to the $ 39 support.
The sustained bullish move appears to be a five-wave bullish impulse. In this case the breakout from the descending wedge was part of the fourth wave.
The high was reached at a confluence of Fib resistance levels created by the 1.27 external retracement of wave four (white) and the 0.618 projection of wave 1-3 (black).
It is not yet certain whether the move up is long-term wave five or just a sub-wave of wave five. The former would mean that a high has been reached, while the latter could eventually lead AVAX to a new all-time high and into a pricing phase.
Whether the short-term decline described in the previous section is an ABC corrective structure or a bullish impulse will likely determine whether AVAX will hit new highs.
A short-term decline is expected in both cases.
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