Avalanche’s native AVAX token has recently experienced this as it faced a significant resistance at the $20 psychological level. Consequently, it plunged 5.8% in the past 24 hours. The rejection sparked more accelerated selling, with prices dropping down to $18.61 after a high of $19.99. That sell-off came just over the top of peak trading volume at 1.9 million, indicating the largest scale of profit-taking and position liquidations.
During those struggles, the token came within 60 cents of the pivotal $20 threshold. The rejection at this level started a quick sell-off. This was compounded with a high trading volume of 1.9 million, occurring when the price reached an all-time high of $18.74 for a few seconds at midnight. This perfect storm of events serves to underscore the importance of the $20 resistance line for AVAX.
Also, a double top pattern around the $19.05 level further confirmed the anticipation of bearishness. This development formation of technical, along with the overt rejection at $20.00, indicates that sellers are still firmly in control on the market. Even CoinDesk’s broader CoinDesk 20 index tumbled, losing 4.2% in the past 24 hours. This drop foreshadows a larger correction in the overall market that has recently begun.
Though all the downward pressure would have these fundamentals suggest, there has been support building in the $18.90-$19.00 area that has withstood a half dozen tests. This support zone may provide a solid AVAX floor in the near future. The power will be the key in determining the token’s next big move. A four-hour bullish consolidation pattern indicates possible near-term stabilization following the steep drop as the market decides its next move.