Avalanche falls 34.3% below recent ATH, tests key support level

Key Takeaways:

• Avalanche prices recorded their highest intraday loss since Sept 20 on Friday.
• The smart contracts platform will launch a hackathon in Dec.

NEW DELHI (CoinChapter.com) — Smart contracts platform Avalanche’s epic bull run took a break after charting a new ATH on Nov 22. The platform’s native token, AVAX, fell 34.3% between its ATH ($1513.754) and Nov 26’s low ($99.58).

On Friday, Avalanche fell alongside other cryptocurrencies due to the FUD created by reports of a new Coronavirus strain coming from South Africa. A heavily mutated Covid strain, named Omicron by WHO, has scientists and doctors worried as mutations would make reinfections more likely.

So far, South Africa, Botswana, Belgium, Hong Kong, and Israel have reported the new virus strain cases.

The global financial market fell prey to panicked liquidations. Ironically, Bitcoin, often considered a hedge against the volatility of traditional financial markets, followed suit. As such, the broad Bitcoin and crypto market sell-off took the overall crypto market cap to $2.33 trillion before recovering to $2.42 trillion at the time of writing.

Also Read: Avalanche (AVAX) coin flips Dogecoin and Shiba Inu to enter the top 10 list.

AVAX prices fell prey to the marketwide sell-off too. Earlier, Twitter-based analyst Edward Morra had highlighted a demand zone between the $100-$107 price levels. In detail, a demand zone is a period of sideways action that usually comes before explosive price action.

$AVAX
[Update]
Watching ~$115 level, will be just a bearish retest or we push through it? pic.twitter.com/E9wdy9kCWn

— Edward Morra (@edwardmorra_btc) November 26, 2021

During Nov 26’s Covid FUD-fuelled market correction, AVAX prices tested the lower trendline of the demand zone before rebounding. As such, investors’ interest in the Avalanche token is strong. Meanwhile, Avalanche is launching a hackathon in Dec, with prizes worth $350,000 for developers.

AVAX Price Chart

Avalanche price fell 18% on Friday, going from the Nov 26’s high ($121.444) to the day’s low ($99.583). Currently, AVAX faces resistance at $118.39. Moreover, if AVAX reverses its current downtrend, prices could move to $126.06. If the Avalanche token breaks free of the bears, the resulting uptrend would likely invite more interest from investors.

As such, AVAX prices could target $134.99 before prices pull back. The Avalanche token is currently bullish across all time horizons

If the upside move fails, AVAX has immediate resistance near the lower trendline of the demand zone at $100.557. However, further downside movement would see the Avalanche token breach below the demand zone, resulting in a drop to support at the $95.33 price level.

However, if profit-taking increases selling pressure, AVAX could likely continue its downtrend, moving to support at $87.336 before recovering.

Also Read: 5 reasons why Avalanche (AVAX) rallied over 30% in just seven days.

Trend-based momentum oscillator turned bearish for AVAX on Friday. As a result, bars on the MACD histogram, which plots the difference between the MACD line (difference of 12-day and 26-day EMA) and the MACD signal line (9-day EMA of MACD), moved below zero

Negative bars indicate the MACD line moved below its signal line, charting a bearish crossover. Meanwhile, the relative strength index is back into the neutral region with a value of 52.91. AVAX moved into the overbought region on Nov 19.

Avalanche Hackathon In Dec

Avalanche has partnered with Moralis to launch the Moralis Avalanche Hackathon Winter 2021. The event will take place between Dec 6 to Jan 31. Moralis is a Web 3.0 development platform, providing developers access to fully managed and scalable blockchain backend infrastructure.

Participants would have to build their projects using both Avalanche and Moralis to qualify for the $350,000 prize pool. Like Three Arrows Capital, Republic, AP Capital, and GBVCapital, leading venture capital firms have partnered with Avalanche for the event.

Participants are required to build a dApp, DeFi project, or a Web 3.0 app to participate. A jury would judge the projects based on their ‘Execution, Impact, Design, Creativity, and Utility.‘

At the time of writing, AVAX was trading at $121.35, up 4.65% on the day.