Market Overview: Avalanche/Tether USDt (AVAXUSDT) on 2025-09-06

• Price declined from a high of $24.57 to a low of $24.09, closing at $24.22 with bearish momentum.
• Volatility expanded in early hours, followed by a contraction as prices stabilized into a tight range.
• RSI signaled overbought conditions early, then oversold in the afternoon, suggesting potential reversal triggers.
• Volume surged during the breakdown below key support, confirming bearish sentiment.
• Fibonacci retracement levels at $24.44 (38.2%) and $24.31 (61.8%) showed resistance during a recovery attempt.

Avalanche/Tether USDt (AVAXUSDT) opened at $24.46 on 2025-09-05 at 12:00 ET and closed at $24.22 on 2025-09-06 at 12:00 ET, hitting a high of $24.57 and a low of $24.09. The 24-hour volume was approximately 592,868.49, while the notional turnover reached $14,526,187.71, reflecting moderate liquidity and bearish sentiment.

Structure & Formations

Price action revealed a bearish breakdown below $24.31, a level that had acted as support earlier in the session. A large bearish candle on 2025-09-05 17:45 ET (volume: 40,864.43) confirmed the breakdown. Later, a bullish engulfing pattern emerged around $24.22, followed by a doji at $24.44, suggesting indecision and potential consolidation. Key support levels now appear to be $24.12 and $24.09, while resistance is forming at $24.26–$24.28 and $24.31.

Moving Averages

On the 15-minute chart, the 20-period MA crossed below the 50-period MA, forming a death cross. This aligns with the bearish bias observed in price action. Daily MA indicators showed the 50-day line at ~$24.50, the 100-day at ~$24.35, and the 200-day at ~$24.20, indicating a slightly bearish alignment with the 50-day acting as resistance and the 200-day as a potential support.

MACD & RSI

The MACD line turned negative in the morning and remained below the signal line for most of the session, reflecting fading bullish momentum. RSI reached overbought territory (70+) in the early hours and dropped into oversold territory (30–) by late afternoon, confirming the bearish divergence. This suggests traders could look for a potential bounce from the $24.12–$24.16 zone, though confirmation above $24.31 is needed for a reversal.

Bollinger Bands

Volatility expanded early in the session as price moved outside the upper band, reaching $24.57. By mid-session, volatility contracted significantly, with prices trading within a tight range for several hours. Price closed near the lower band at $24.22, indicating a bearish bias. A move above the midline of the bands would suggest a potential reversal but is unlikely without a strong volume spike.

Volume & Turnover

Volume was relatively consistent throughout the day, with a notable spike around the breakdown below $24.31. Notional turnover mirrored this pattern, with a high of $1.5M in that candle. Price and turnover aligned well during the breakdown, confirming the move. However, in the final hours, volume declined despite price action showing a recovery attempt, which could suggest short-term indecision.

Fibonacci Retracements

Fibonacci levels were key in identifying resistance and support. The 38.2% level at $24.44 and the 61.8% level at $24.31 acted as resistance during the recovery attempt, limiting upward momentum. On the daily chart, the 61.8% retracement from the recent high is at $24.16, coinciding with a potential support zone. Traders should monitor this level for a possible rebound or breakdown.

Backtest Hypothesis

The described backtest strategy involves entering short positions on a breakdown below key Fibonacci levels, particularly the 61.8% retracement, and exiting on a close above the 50-period MA. Stops are placed above the 38.2% level for risk management. Based on today’s action, the strategy would have been activated at the breakdown of $24.31, with a target of $24.12 and a stop at $24.44. This setup has a favorable risk-reward profile but requires confirmation on volume and price action to validate the move.