Avalanche (AVAX) Trend Reversal Signaled by Breakout from Descending Broadening Wedge

The descending broadening wedge—a bearish pattern to suggest a potential bullish breakout action—had limited AVAX's price action since December 2024.

Avalanche (AVAX), ranked #15 in terms of market capitalization, has begun to pique the interest of traders following a confirmed breakout from a descending broadening wedge on the daily timeframe. This breakout, evident on recent technical charts, may herald an important trend reversal after several months of price contraction.

According to Shapeshift Capital’s analysis, assuming that AVAX continues to hold above levels of $22.88 and volume returns, then traders can expect to see a rally between 100% to 150% to take place. The breakout is currently being tested in the vicinity of the $24.33 resistance zone, where a stable price and a more general market mood are important in validating the trend.

Avalanche (AVAX) - Broadening Wedge Breakout Signals 100%-150% Rally, But Crucial Support Must Hold

The descending broadening wedge—a bearish pattern to suggest a potential bullish breakout action—had limited AVAX’s price action since December 2024. The breakout near $22.88 support is viewed as technically interesting since it took a long time to consolidate and was also accompanied by increasing volumes of trading.

As of May 10, 2025, AVAX was trading at approximately $24.17, reflecting a 4.7% increase in the last 24 hours. Compared to Bitcoin, the token has risen 3.5% to trade at 0.0002329 BTC. The move higher saw the token break above the wedge’s resistance and this is concurrent with a local resistance test at $24.33. Price levels in the vicinity of this zone are now subject of great scrutiny to determine whether the breakout will hold or be denied in the short term.

This recent breakout is in line with other altcoins that have started to move upwards. Perhaps this reflects a general rebound in investor risk appetite. However, traders are reminded that the snapshot of the chart structure is promising but crucially, confirmation is needed in both price and volume. A breakdown from support at around $22.88 might indicate that the breakout was false, potentially sending AVAX back to its previous trading range.

If, however, this level manages to hold with increasing buyer volume then a strong rally might develop. The measured pulse from the wedge pattern implies a possible price target in the $40-$60 timeframe. Nevertheless, this projection is dependent on positive macroeconomic conditions and wider crypto market sentiment which Shapeshift Capital notes remains "promiscuous."