Avalanche (AVAX) Forms Double Bottom Pattern, Eyes 41.80% Rally

Avalanche (AVAX) is currently exhibiting signs of a potential bullish reversal, as it forms a double bottom pattern at a crucial support level. This pattern, if confirmed, could signal a shift from the prevailing bearish trend to a more optimistic market trajectory. The double bottom structure is developing within a high time frame support region, which has historically acted as a major pivot zone. This support zone is further reinforced by the point of control and Fibonacci levels, adding to the confluence of technical indicators suggesting a possible change in market direction.

The double bottom pattern is taking shape as AVAX maintains its position above a well-established support region. This area aligns with the point of control from the visible range volume profile, emphasizing its importance. A double bottom in this context indicates a transition from prolonged selling pressure to potential accumulation. For the bullish reversal to be validated, AVAX must break above the local high, which serves as the neckline of the pattern. This breakout would not only activate the double bottom but also mark the first higher high, transitioning AVAX into a bullish market structure on higher time frames.

A confirmed breakout above the local high would pave the way for a rally toward the value area high, which coincides with the 0.618 Fibonacci retracement level. This places the next technical target at approximately $41.80. The price reaction at this resistance zone will be crucial in determining whether AVAX continues into a longer-term uptrend. Currently, trading volume remains subdued, which is typical in the early stages of reversal patterns. However, a significant influx of volume following the breakout above the local high would lend credibility to the breakout and could accelerate the move toward $41.80 and beyond.

In the coming price action, if the double bottom holds and AVAX breaks above the local high with strong volume, the path toward $41.80 becomes highly probable. Traders should closely monitor for a decisive move and confirmation via volume to validate the bullish breakout scenario. The confluence of technical indicators and the historical significance of the support zone suggest that AVAX is poised for a potential bullish reversal, provided that the breakout is accompanied by strong volume.