Topdown Analysis Of AVAXUSDT Using Support And Resistance Strategy And RSI Indicator As Confluence

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Hello great minds,

I feel honored to approach you all today to discuss on a very important issue in the cryptospace.

I believe you are all doing perfectly fine and are enjoying your activities in the community as you actively promote steemit across various social media platform.

Today I will be sharing my analysis on the token of avalanche network which is avax, and I will be sharing my analysis on avax against usdt.

Please stay tuned as I share my analysis

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ANALYSIS USING SUPPORT AND RESISTANCE STRATEGY

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Technical analysis are best started from the higher timeframe and then to the lower timeframe.

Some analyst prefer starting their analysis from the daily timeframe, down to the fewer minutes, but I begin mine from the monthly timeframe.

The monthly timeframe helps me to compress market activities and display them on a screen.

And the monthly timeframe also helps in eliminating unnecessary noise from the market.

Beginning with the monthly timeframe of the pair AVAXUSDT, we can see the formation of bullish and bearish candles.

We can also see that there are few candles on this timeframe and this is because each candlestick were formed within the space of 1month.

Also from the above screenshot, we can notice that it is easier for the market trend to be identified, and from the above screenshot we see that the most recent leg of the market is bullish.

I then continued my analysis by moving to the weekly timeframe, and on this timeframe, there are more market candles than on the monthly timeframe and this is because each candle formed on this timeframe takes a period of 1week to be completely formed.

Also on this timeframe, I was able to spot a key level and this level is functioning as a resistance level to the market price.

It is expected that whenever the market trades to that level, it should get rejected to the opposite direction, as there tend to be more sellers on that level.

Continuing my analysis, I moved to the daily timeframe which can be confirmed from the above screenshot.

And on this timeframe, we can see the presence of numerous buyers and sellers in the market as they struggle to push price to their preferred direction.

Looking carefully on this timeframe, I was able to spot another key level on this timeframe, and this level is functioning as a support level to the market price.

As it is expected for the market to be rejected to the bullish side whenever it trades to this level.

I then continued my analysis on the 2hr timeframe and on this timeframe, I could see more market activities, more noise in the market.

I then proceeded to mark out a key level which will function as a resistance level to the market price.

It is on this level that I intend to set my take profit position when I place my buy order on the market.

Moving to the 2hr timeframe, I could see the market trade toward the support level.

And I expect to see the market get rejected when it trades to this level, and with this, my bullish bias was strengthened and I decided to search for confluence using rsi indicator.

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CONFLUENCE USING RELATIVE STRENGTH INDEX INDICATOR

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The rsi Indicator is a very important trading tool in the cryptomarket.

The rsi indicator is used to spot oversold and overbought market regions.

And when a market is spotted to be oversold, it is a signal that the market is about to experience a bullish move.

And when a market is spotted to be overbought, it is a signal that the market is about to experience a bearish move.

From the monthly timeframe, I noticed that the rsi has crossed below the 50% line and when it gets to the 20% line, the market can be said to be oversold.

And an oversold market often signals a bulllish trend reversal and this implies that the market is expected to be bullish in a while.

And this is in alliance with my analysis using support and resistance strategy, and then I continued by checking a lower timeframe.

Applying the rsi to the daily timeframe, I noticed that the rsi indicator is approaching its 20% line, and this is an indication that the market is about to be oversold.

An oversold market signals a bulllish trend reversal, and this implies that we expect to see the market go bullish with time

With these confluences I decided to move to the 2hr timeframe in search for entry into the market

Getting to the 2hr timeframe, I noticed that the market was already oversold, and this is an indication of a bullish trend reversal.

With this, I decided to enter a buy and I placed my entry on the closest support level to the market price, and my take profit was placed on the closest resistance level to the market price, just as seen above.

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CONCLUSION

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Avalanche is a very nice crypto project in the cryptospace and its native token is what we know to be avax.

And as seen above, I have shared my analysis on AVAXUSDT, and I intend for my post to be taken as an educational content and not a financial advise.