Despite strong mood, AVAX was being rejected on price at the time of publication.
Despite increased investor confidence, Avalanche’s [AVAX] rebound could be limited. The asset has saw a 14% decline, going from a high of $22.8 to a low of $19.4.
Bulls began a tremendous attempt at a rebound, but technical signs seemed to indicate that their efforts would not be sustained.
At $21.04, AVAX received price rejection.
AVAX successfully crossed above the downtrend line and overcame the barrier at $19.81 thanks to the momentum, which changed the short-term market structure from bearish to positive.
The bulls were beaten back by the price rejection at $21.04, though. Before retesting the 21.04 level, AVAX may find support at the seven-period EMA of $20.52 or $20.40.
AVAX bearish, on the other hand, might undervalue the asset in the coming hours if BTC lost the $23k zone and fell below $20.40 and the 26-period EMA. However, the decline can stop around $19.81 or the downtrend line.
Bulls may be short-lived, according to the Relative Strength Index (RSI) and On Balance Volume (OBV), which both reported a downtick.
AVAX saw a rise in investor confidence, however…
According to data from Santiment, AVAX had an increase in investor confidence starting on February 5 as seen by the weighted sentiment’s change from negative to positive. Notably, the increased development activity during that time may have improved investors’ view.
It demonstrated that the network’s possibilities had investors feeling confident, which was also reflected in a rise in price.
Even if it’s a good sign, the absence of further demand for the asset in the futures market can impede the strong upward momentum required to cross the $21.04 price rejection barrier.
As a result, the impetus for AVAX’s recovery may be limited, and traders should keep an eye on BTC’s price action as well as the price rejection level at $21.04.