Avalanche's Price Slump: Is $6.05 the New Support Level?
The price of AVAX currently sits at $6.68 on the market, but Iris Coleman notes that it's still trading 34% below its 200-day SMA, which is a significant indicator of structural weakness.
The technical analysis suggests that the path of least resistance runs to $6, and there are several key support levels that could be tested in the coming days. The lower Bollinger Band at $6.29 and the $6.05 downside target are particularly important, as they represent potential floors for AVAX.
Coleman notes that 70%+ of both retail and smart money is already positioned long on AVAX, which could lead to a crowded trade and increased selling pressure if prices fall. Additionally, open interest on AVAX futures has climbed 4.48% in the last 24 hours while price fell 1.30%, indicating a textbook OI-price divergence.
The analyst views circulating this week split cleanly between near-term caution and longer-term optimism, but Coleman notes that both can be simultaneously correct. A grind lower is seen as the highest-probability scenario over the next 7-30 days, with a daily close under $6.56 on expanding volume being a key trigger.