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 bearish.

And moving to the monthly timeframe, I could see more market activities, as each candle on this timeframe is formed after a trading period of 7days.

And looking carefully, I was able to identify a key level and this level is a bit far from the market price but it is a level functioning as a resistance level to the market.

And whenever the market trades towards this level, we can expect to see a rejection from this level, we can expect to see the strength of the sellers in the market.

And moving to the daily timeframe, I could see the market bore clearly, I could see how noisy the market is as the buyers and sellers are driving the market towards their preferred direction.

And looking carefully, I was able to identify another key level, and this level will be functioning as a support level to the market price.

And from the chart above, we can see that this support level is a valid level as the market has made several touches on it and have been unable to break below it.

Getting to the 4hr timeframe, I could see more market candles and I was able to see that the bears are in control of the market.

From the above screenshot, we can see that the market kept forming lower lows and lower highs as it trades towards the support level of the market price.

And as I looked at the market, I was able to spot a key level which I expect the market to retrace towards and I marked out this level as I intend to leverage this move.

And then I came to the 2hr timeframe in search of entry into the market.

And on this timeframe, I could see that the market is moving towards its support level before it retraces fully, and before entering this trade, I decided to search for confluence using the relative strength index indicator.

---

---

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.

Getting to the monthly timeframe, I decided to add the rsi indicator, and after adding this indicator, I realised that the market is being oversold, and an oversold market signals a bulllish trend reversal of the market.

It is a market condition that indicates the weakness of the bears and the strength of the bulls in the market.

And on the daily timeframe, I realised that the market was being oversold, and as explained, an oversold market is one that signals a bulllish trend reversal of the market.

And this is in confluence with my analysis using support and resistance strategy, alongside with the signal gotten from the monthly timeframe.

And then, I decided to move to the 2hr timeframe in search of entry into the market.

On the 2hr timeframe, I proceeded to place my entry on the closest support level to the market and my take profit was placed on the closest resistance level to the market, 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.