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

Source

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

---

---

ANALYSIS USING SUPPORT AND RESISTANCE STRATEGY

---

---

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 moved to the weekly timeframe to continue my analysis, and from this timeframe I could see more market activities than on the monthly timeframe.

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

And it is expected that when the market gets to this level it gets rejected to the downside, as it has been respected by the market in the past.

I then moved to the daily timeframe for more market analysis, and on this timeframe, I can see more market activities.

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

And from the above screenshot, we can see that the market has been rejected by this level, and this is what is expected to occur.

Then I decided to continue my analysis on the 4hr timeframe.

Moving to the 4hr timeframe, I could see lots of market noise as the buyers and sellers struggle to push price to their preferred direction.

On this timeframe, I was able to spot another key level, and the market is expected to get to this level after being rejected.

And it is on this level that I intend to take my profit off the market.

Then I moved to the 2hr timeframe, as it is on this timeframe that I take my entry.

On this timeframe, I could see the market more clearly and my bullish bias have been established.

Then I decided to make use of the rsi indicator to serve as a confluence to my trade.

---

---

CONFLUENCE USING RELATIVE STRENGTH INDEX INDICATOR

---

---

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.

I then decided to apply the rsi to the monthly timeframe, and from the screenshot above, we can see that the rsi has crossed above the 80% line.

And this is an Indication that the market is being overbought, and an overbought market signals that the market is about to experience a bearish trend.

Then I decided to continue by making use of the rsi indicator on the daily timeframe.

On the daily timeframe I noticed that the rsi has crossed below the 20% line and this is an indication that the market is being oversold.

And an oversold market signals a bullish trend reversal signal, and this is in alliance with my analysis using support and resistance strategy.

I then move to the 2hr timeframe Inorder to search for confluence into the market.

From this timeframe, I decided to enter a buy order from the support level closest to the market price.

And my take profit was placed on the closest resistance level just as seen above.

---

---

CONCLUSION

---

---

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.