Ever since the price of Avalanche (AVAX) was rejected by the $10.50 horizontal resistance level on October 7, the market has been trending downward.
The breach of Stars Arena, a platform based on the Avalanche blockchain, may have been the cause of the decline in AVAX’s price.
A recovery and a weekly finish over $10.50 will indicate that the breakdown is invalid, notwithstanding the negative AVAX price forecast.
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Avalanche Is Unable to Overcome Horizontal Opposition
The weekly timeframe’s technical analysis reveals that the price of AVAX was unable to maintain its rise last week. Even though it first hit a high of $11.88, it was unable to close above the horizontal resistance zone of $10.50.
Instead, it formed a lengthy top wick (red symbol) and descended beneath it.
The cryptocurrency has been trading above the $10.50 mark since 2021, making it a critical sector. AVAX attempted, but failed, to recover it last week after dropping below it in August.
Stars Arena, a SocialFi platform developed on the Avalanche blockchain, was introduced shortly after the previous price spike in Avalanche gained traction.
A different Social Finance (SoFi) network called Friend.tech, which has recently been dealing with phishing issues, is the source of Stars Arena.
On October 7, however, Stars Arena was hacked, which could have accelerated the current decline in AVAX prices. Since then, after settling with the assailant, it has retrieved 90% of its money.
The squad had to pay 27,610 AVAX for this, which is now valued at $252,000. There is now a new smart contract in place.
AVAX Price Prediction: Will Further Declines Be Caused by Bearish RSI?
When determining whether to buy or sell an item, market traders use the RSI as a momentum indicator to spot overbought or oversold situations.
Bulls still have the upper hand, according to readings over 50 and an upward trend; readings below 50 imply the reverse. The indicator is trending downhill and is below (red circle), both of which are indicators of a bearish trend.
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