Avalanche (AVAX) is facing significant bearish pressure as its price breaks below the key $16 support level that has held since March 2025, according to analyst @ali_charts. This breakdown occurs amid fading market momentum and a weakening price structure, with the token hovering near the 50-day exponential moving average (EMA). A decisive move below this EMA has historically triggered sustained selloffs, and the current setup suggests acceleration in downward momentum.
Analyst Carl Moon highlighted that AVAX is entering a deep discount zone near $8.72, aligned with Fibonacci retracement levels from the 2024 peak of approximately $68. This region, spanning $8 to $12, is identified as a smart money buy zone, where institutional investors typically accumulate during bear markets. The chart structure projects a potential W-shaped bottom formation, with a rebound target toward $28 by mid-2026 if support holds.
Derivatives data from Coinglass reveals a sharp cooling in AVAX markets, with trading volume dropping over 50% and open interest slipping slightly, indicating reduced speculative interest. Despite long/short ratios favoring bullish positions—exceeding 2.0 on exchanges like Binance and OKX—liquidation data shows over $600,000 in long positions wiped out in 24 hours, underscoring growing pressure on bulls. Market sentiment remains cautious, with traders emphasizing due diligence amid potential capitulation lows.
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