Avalanche (AVAX) is stuck below $20 as bearish signals hinder a strong recovery.

Avalanche (AVAX) could not regain the support level of $20.00 after a sharp decline during the recent correction. This altcoin is currently trading much lower than the important threshold, although selling pressure has significantly decreased.

However, the upward momentum is still not strong enough to counter the prevailing bearish signals.

Investors do not sell out

Analysis of the profit of active addresses shows that less than 3% of current participants are in profit.

This data shows an important detail: most AVAX holders do not want to sell at a loss. Instead, they seem to be HODLing in anticipation of a recovery. The decision not to sell is seen as a bullish indicator.

The patience that investors are showing during this recession may help AVAX establish a stronger foundation as overall market conditions stabilize.

When fewer holders participate in the sell-off, the downward pressure on AVAX may also decrease. With the right market catalysts, this opens up opportunities for altcoins to recover.

Classifying Avalanche addresses by profit | Source: IntoTheBlockAlthough selling activity is low, technical indicators continue to signal weakness. The Relative Strength Index (RSI) has returned to the bearish zone after a brief recovery attempt. This indicates a lack of buying pressure and instability from investors.

The market lacks support for AVAX in recent sessions, hindering any meaningful recovery. This altcoin is facing resistance and is not generating strong upward momentum.

The RSI trend reinforces that the macro environment is still on a downward trend, which is restraining AVAX.

RSI Avalanche | Source: TradingView## AVAX is vulnerable

AVAX is currently trading around $15.98, marking a nearly 30% drop over the past two weeks. The sharp decline occurred after AVAX failed to break through the resistance level of $22.87.

This rejection has led to the current consolidation below $20.00, with the bulls still unable to reverse the trend.

With the current market signals, Avalanche may struggle to reclaim $18.27 as a support level. If the altcoin cannot defend this level, it risks dropping further below $16. This would add further strain on investors and delay any recovery opportunities.

AVAX Price Analysis | Source: TradingViewOn the positive side, a significant change will occur if AVAX can flip the $19.86 level to support. This indicates that bullish sentiment is being reinforced and opens the door for a growth towards $22.87.

Regaining this level could allow AVAX to recover some of its recent losses and restore investor confidence.

You can view the AVAX price here.

Disclaimer: This article is for informational purposes only and is not investment advice. Investors should conduct thorough research before making decisions. We are not responsible for your investment decisions.

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Viet Cuong

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