‎AVAXUSD Head and Shoulders Formation Signals Further Downtrend

‎AVAXUSD Market Analysis- June 6

‎Avalanche (AVAX) is currently exhibiting strong bearish characteristics, as a recently confirmed head and shoulders pattern signals a potential continuation of its downtrend in the AVAXUSD market.

‎AVAXUSD Key Levels

‎Support Levels: 14.80, $8.70
‎Resistance Levels: $22.50, $30.60

‎AVAXUSD Long-Term Trend: Bearish

‎Avalanche (AVAX) has entered a clear bearish phase, marked by a significant shift in market sentiment. During Q4 2024, price action peaked in September around $30.60, forming an initial high. This was followed shortly by an even stronger rally, pushing price to a new all-time high. However, this bullish momentum was short-lived.
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‎The sharp rally was followed by an aggressive selloff, driving AVAX back into its key support and resistance zone. The decline found temporary relief at the $14.80 level, triggering a minor bullish recovery that slightly surpassed the $22.50 mark. Despite this upward movement, the rebound lacked strength and ultimately failed to establish a new bullish structure.
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‎From a broader technical perspective, price action between late 2024 and Current 2025 has formed a distinct head and shoulders pattern—a classic bearish reversal structure. This large-scale formation strongly suggests a continuation of the downtrend, with further price declines anticipated in the coming weeks. A break below the neckline of this pattern confirms bearish dominance, potentially driving AVAX toward new lows if key support zones fail to hold.

‎AVAXUSD Medium-Term Trend: Bearish

‎The medium-term outlook aligns with the broader downtrend. On the daily timeframe, the minor bullish correction has concluded, giving way to renewed bearish pressure. The 4-hour chart confirms this shift, as a bearish break of structure has occurred. Price is currently within a bearish leg, preparing for a likely retracement toward a nearby 4-hour order block.
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‎Notably, the 4-hour Relative Strength Index (RSI) is hovering near the oversold region, indicating a potential temporary relief rally or pullback. When RSI reaches these levels, price often retraces slightly before continuing its primary trend. Therefore, it is advised to expect a short-term bullish retracement into the order block zone, followed by a continuation of the downward move in line with the dominant bearish trend.‎

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