Avalanche Market Overview: 2025-08-29

• Price closed lower at 23.9, down from the 24.72 open, amid weak volume and consolidation.
• Bearish momentum emerged as AVAXUSD broke key psychological levels, with RSI indicating oversold conditions.
• Low trading volume during the session suggests lack of conviction in either direction.
• Bollinger Bands narrowed before a sharp decline, signaling a potential breakout or breakdown in play.
• No major bullish catalysts were observed, with bearish engulfing patterns visible in 15-minute data.

Avalanche (AVAXUSD) opened at 24.72 on 2025-08-28 at 12:00 ET and closed at 23.9 at the same time the following day. The 24-hour candle recorded a high of 24.93, a low of 23.5, and a total volume of 58.93 million tokens, translating to a turnover of $1,451.5 million. The price action reflected bearish sentiment throughout the session.

Structure & Formations

Avalanche’s 15-minute chart displayed multiple bearish signals. A notable bearish engulfing pattern appeared at 2025-08-29 071500, where the candle opened at 24.93 and closed sharply at 24.31, indicating strong selling pressure. This was followed by a long lower wick at 2025-08-29 081500, which opened at 24.31 and closed at 24.03, suggesting attempted buying support but ultimately failing. A doji formed at 2025-08-29 120000, reinforcing indecision in the market. Key support levels were identified at 24.31 and 23.9, while resistance remained around 24.74 and 24.93.

Moving Averages

On the 15-minute chart, the 20-period and 50-period moving averages (MAs) were closely aligned, with AVAXUSD closing below both at 23.9. This indicates bearish alignment on the short-term chart. On the daily chart, the 50-period MA was at ~24.5, while the 100-period and 200-period MAs were at ~24.35 and ~24.2 respectively, suggesting the price is below all major averages and could continue to consolidate downward.

MACD & RSI

The MACD crossed into negative territory during the session, confirming bearish momentum. The RSI hit an oversold condition below 30 at 2025-08-29 120000, indicating the asset may be due for a short-term bounce. However, this oversold reading did not trigger a reversal, reinforcing the bearish narrative.

Bollinger Bands

Bollinger Bands contracted sharply between 2025-08-29 060000 and 2025-08-29 120000, indicating a period of low volatility and consolidation. The price eventually broke below the lower band at 2025-08-29 124500, forming a bearish breakout. The width of the bands remains moderate, but the recent breakdown suggests increased volatility is likely in the near term.

Volume & Turnover

Trading volume was muted for most of the session, with spikes observed at 2025-08-29 041500 and 2025-08-29 134500. The volume at 2025-08-29 134500 coincided with the breakdown below 24.18 and was the largest in the 24-hour period. Notional turnover mirrored this pattern, with the largest turnover at $111.8 million at 2025-08-29 134500. The divergence between price and volume was minimal, supporting the bearish narrative.

Fibonacci Retracements

Fibonacci levels were drawn on the 15-minute chart between the high at 24.93 and the low at 23.5. The 23.9 close aligned closely with the 61.8% Fibonacci retracement level (23.88), suggesting a possible pause in the downtrend. On the daily chart, the 38.2% retracement level is at ~24.55, and the 61.8% level is at ~24.35. AVAXUSD’s close at 23.9 is slightly below the 61.8% level, indicating bearish pressure.

Backtest Hypothesis

The bearish engulfing pattern observed at 2025-08-29 071500 (open at 24.93, close at 24.31) presents a compelling case for a short-term bearish backtest. A possible strategy would involve entering a short position on the open of the following candle and exiting after a fixed 5-day holding period or upon reaching a stop-loss of -5%. Given the 15-minute timeframe and the sharp decline following the pattern, this could be a profitable setup in a controlled backtest. To apply this to a comparable market, a broad-based index such as SPY could be used with the same parameters, providing a benchmark for relative performance.