Avalanche Bulls Target Breakout—But Here’s Why Smart Money Remains Cautious

Avalanche (AVAX) traders are riding high on breakout hopes—until they glance at the mid-term charts. The Layer-1 contender keeps teasing a bullish surge, but seasoned investors spot storm clouds gathering.

The Bull Case: Fast, Cheap, and Hungry

Avalanche’s subnets and institutional adoption keep fueling momentum. Transaction speeds eat Ethereum for breakfast, and fees stay laughably low—unlike some *cough* legacy chains bleeding users dry.

The Catch: Macro Won’t Play Nice

Regulatory headwinds and Fed whispers could freeze crypto’s comeback. Even AVAX’s tech muscle might not dodge a market-wide correction. Pro tip: Watch BTC’s moves—no altcoin truly decouples.

Bottom Line

This isn’t 2021’s mindless rally. Bulls need more than hopium to crack resistance. But if AVAX holds key support? The upside could make today’s skeptics look like yesterday’s bagholders.

1-Hour Timeframe And 4-Hour Timeframe Analysis

Crypto Analysis AI recently highlighted that AVAX/USDT is flashing bullish signals on the 1-hour timeframe, with 30 buy signals against just 9 sell signals. Indicators such as the EMA crossover (9 > 20), a bullish MACD, and a DMI uptrend suggest positive short-term momentum.

The RSI at 59.48 supports a bullish outlook without being overbought, while the CMF at 0.1367 signals accumulation. These signs point to strong buyer interest and underlying market strength at current levels.

However, some caution is warranted. The KDJ indicator has issued a sell signal, and the HMA reflects potential short-term exhaustion, pointing to a brief pause or pullback in the uptrend.

On the 4-hour chart, momentum weakens slightly with 29 buy signals facing 14 sell signals. While the ADX (37.80) confirms trend strength, the CCI (143.48) and RSI (65.03) suggest overbought conditions NEAR the $23.24 resistance. 

Avalanche Current Price Action & Key Levels

According to crypto Analysis AI, Avalanche was trading around $22.89, testing key resistance zones. The price recently surged from $21.16 to $23.24 on the 4-hour chart, before entering a consolidation phase in a tight range between $22.80 and $23.00. Short-term momentum looks bullish, especially on the 1-hour timeframe, whereas the 4-hour chart suggests the trend may be losing steam and needs confirmation for further upside.

Crypto Analysis AI predicted a breakout toward $23.50–$24.00, and AVAX has surpassed this level. On the downside, initial support lies at $22.60, followed by $22.00–$22.20 as a stronger demand zone. If losses deepen, $21.60–$21.80 could provide key support.

The analyst also warned of overbought signals on the 4-hour RSI and CCI, which may trigger a short-term pullback. Additionally, low volume during recent dips signals weak buyer follow-through. 

Giving his final verdict, the analyst noted that Avalanche remains in an uptrend, but short-term traders might consider looking for pullbacks to the $22.60–$22.80 range for potential long setups. Meanwhile, medium-term traders are advised to watch for either a confirmed breakout above $23.24 or a deeper retest of the $22.00–$22.20 zone, as this could establish a stronger support base.