Avalanche price is hanging by a thread as it threatens to break a major support intersection with a perfect set up for a bullish reversal. The price action in the past few weeks has been crucial for the fate of the token, as it could either continue lower and test new lows or change the trend and spark a swift and unexpected rally.
As Bitcoin price struggles to rise above $95,000, Avalanche price flashes huge potential of a bullish continuation. The token has been forming consecutive lower highs and lows after the rejection from the pivotal range at $22. In a wider perspective, the bears seem to have held a strong grip over the rally, but the AVAX price is flashing a hidden bullish divergence that may clear the path above the local threshold.
Avalanche price chart on the weekly time frame
The AVAX price underwent its second successful rejection from the neckline zone, which has flashed a huge opportunity to take short positions. With the markets bleeding, there is a huge possibility that the price could take a dip towards the lower target that could complete a massive double top pattern, which could further harm the AVAX price rally in the long term.
However, the technicals do not seem to be in favor of a massive pullback, while a tight accumulation could prevail for some time. The bears have restricted the rally below $22 since the major pullback in March, which seems to have drained the strength of the bulls.
Besides, the Bollinger bands have begun to squeeze as the volume drops, hinting towards a drop in the volatility. Meanwhile, the CMF or the Chaikin Money Flow,, has triggered a bullish rebound from the levels not visited since July 2024. Each time the weekly CMF rebounds from the lows below -0.15, a huge upswing follows with nearly a 200% price rise.
Therefore, the AVAX price could trigger a strong rebound if the levels close above $20 and sustain for a day or two. With this, a rise above $22 could be validated that may further push the price above $25 and validate a rise above the bearish captivity. Failing to do so may keep the Avalanche price consolidated below $22 until a huge bullish volume creates massive buying pressure over the crypto.
