Market Overview for Avalanche/Tether (AVAXUSDT) - 2025-11-05

Summary
• Price surged from $15.98 to $16.56 in 24 hours with a late rally.
• Strong bullish momentum observed with RSI reaching overbought levels.
• Volatility expanded, with price breaking above key resistance.

Avalanche/Tether (AVAXUSDT) opened at $15.98 (12:00 ET - 1) and closed at $16.56 (12:00 ET). The 24-hour high was $16.90, while the low was $15.00. Total volume amounted to 5.5 million AVAX, with a notional turnover of approximately $88.5 million across the 24-hour window.

Structure & Formations

The 24-hour price action for AVAXUSDT displayed a strong bullish bias following a key breakout. After a sharp pullback to $15.00, the price rebounded in a strong continuation pattern, forming bullish engulfing candles after 21:00 ET. A significant resistance level at $16.45 was tested and breached, with a confirmed breakout above it. A small doji near $15.00 acted as a reversal signal, supporting the recent rally. Immediate support levels are now at $16.20 and $15.80, while resistance remains at $16.70 and $16.90.

Moving Averages

On the 15-minute chart, the price has closed above both the 20-period and 50-period moving averages, indicating a strong near-term bullish trend. The 50-period MA is currently at $16.22, and the 20-period MA is at $16.40, suggesting price is well above the average trend. On the daily chart, the 50-period MA sits at $15.75, with the 200-period MA at $15.10. The price is comfortably above both, supporting a longer-term bullish outlook.

MACD & RSI

The MACD line turned positive at 0.20 with a strong histogram bar, indicating increasing bullish momentum. The RSI crossed into overbought territory above 70, signaling potential exhaustion in the current rally. However, given the strong volume and recent breakout, a continuation of the upward move may still be in play.

Bollinger Bands

Volatility has expanded significantly, with the upper Bollinger Band at $17.00 and the lower band at $15.10. Price remains near the upper band, indicating overbought conditions and a strong trend in place. A retest of the upper band in the next 24 hours could provide further confirmation or signal a potential pullback if it fails to hold.

Volume & Turnover

Volume surged in the late hours of the 24-hour period, particularly from 20:00 to 24:00 ET, as the price broke out of the consolidation range. Notional turnover also spiked, confirming the strength of the move. The divergence between volume and price is not a concern at this stage, as both metrics are aligning with the bullish momentum. Sustained volume above $16.50 will be critical for confirming a continuation of the trend.

Fibonacci Retracements

Applying Fibonacci retracement levels to the recent swing low at $15.00 and high at $16.90, key levels are currently at $16.34 (38.2%), $16.54 (61.8%), and $16.74 (78.6%). Price has already tested $16.54 and is now approaching $16.74. A successful close above $16.74 would strengthen the case for a continuation of the upward trend.

Backtest Hypothesis

The backtest results for an RSI overbought strategy on AVAXUSDT align with the recent price action, where RSI surged into overbought territory and price continued higher. The strategy, which triggers trades when RSI crosses above 70 and exits with fixed stop-loss and take-profit levels, delivered a 33.23% total return since 2022. However, the strategy also endured a max drawdown of -54.38%, underscoring the need for strict risk management. With the current RSI again in overbought conditions, traders may consider the historical performance of the strategy when evaluating risk-reward setups.