Disclaimer: The findings of the following analysis are the only opinions of the writer and should not be considered investment advice
Tether’s dominance as measured by the USDT Dominance metric was 4.66% at the time of writing. It has also risen in recent months. In fact, this has gone hand in hand with asset prices in the crypto market collapsing, evidence of capital flow into stablecoins and away from risky assets.
Avalanche has failed to break the $100 mark in 2022, and faces selling pressure of $96. It is already 50% off its ATH and could be driven lower in the longer term.
AVAX-1 daily chart
Source: AVAX/USDT on TradingView
In January and mid-February, the price tried to push towards $100. However, it was stopped at $97.35 and $98.7. During the same period, AVAX formed consecutive higher lows (indicated by the blue arrow).
The charts showed that the $88 area remained a place to sell AVAX for higher time frame market participants. The $65 support level could be a relatively safe buying opportunity, but a session closing below $64.45 would invalidate the opportunity.
Further south, in the $52 (cyan box) area, the demand for AVAX could also enter the market.
rode
Source: AVAX/USDT on TradingView
The RSI hovered just below neutral 50 and stood at 44.5 at the time of writing. Just as the price has been building higher lows for the past month and a half, so has the RSI. However, the MACD fell below the zero line as it formed a bearish crossover and plunged lower.
Overall, momentum has been bearish, but the higher lows offered some hope that AVAX could turn things around. The OBV has also climbed higher in recent months after forming consistent higher lows despite some pullbacks. Therefore, there seemed to be evidence of steady purchases despite volatile price action.
Conclusion
The OBV suggested that the purchasing volume has been stable for months, although there was a deep drop in the meantime. This question alone might not rule out Avalanche getting another move toward $50 on the charts.
Bitcoin was not bullish on the higher timeframes, so AVAX investors should be prepared to deal with risks. USD 65 and USD 52 could provide buying opportunities in the coming weeks, while the USD 88-$95 area is likely to be defended by the bears.