Topdown Analysis Of AVAXUSDT Using Support And Resistance Strategy And RSI Indicator As Confluence

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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

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ANALYSIS USING SUPPORT AND RESISTANCE STRATEGY

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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 weekly timeframe, I could see the market more clearly, I could see more candles on this timeframe as each candle here takes a period of 7days to be completely formed.

And looking carefully, I was able to identify a key level and this level is functioning as a resistance level to the market price, and the market is expected to be rejected whenever it trades towards this level.

And from the above screenshot, we can see that the market has kept forming lower lows and lower highs ever since it got rejected by this level.

I then continued my analysis by going to the daily timeframe and on this timeframe I could see lots of market candles.

I could feel the presence of the buyers and sellers as they struggle to drive the market to their preferred direction, and on this timeframe I was able to identify another key level.

This level is functioning as a resistance level to the market price, and as we can see, the market was rejected as it traded towards this level, and we can expect to see more rejection whenever the market trades towards this level.

And getting to the 4hr timeframe, I could see lots of noise in the market and I could see the dominance of the sellers as the market kept declining by forming lower lows and lower highs.

And looking carefully, I was able to identify a key level, and this level is functioning as a support level to the market price, and on this level there are lots of buyers than sellers.

As the market approached this level, I expect to see a bullish rejection and upon the formation of a bullish rejection, I can decide to place a buy position in the market.

With my bullish bias of the market I then decided to visit the 2hr timeframe In search of entry into the market.

And on this timeframe, I was able to identify another level which will function as my take profit level but before I enter the trade, I decided to search for trading confluence using the relative strength index indicator.

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CONFLUENCE USING RELATIVE STRENGTH INDEX INDICATOR

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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.

I then decided to begin from the monthly timeframe in adding my rsi to the market

And from the reading of the rsi on the monthly timeframe, we can say that the market is being oversold, and this can be detected when the market crosses below its 20% line.

And an oversold market is understood to signal a bullish trend reversal, which is in confluence with my analysis using support and resistance strategy.

And getting to the daily timeframe I could see that the market is being oversold, and as explained, an oversold market is one that signals a bulllish trend reversal of the market.

An oversold market often signals the weakness of the bears and the strength of the bulls as the bulls are about to take control of the market.

I then decided to move to the 2hr timeframe in search of entry.

And moving to the 2hr timeframe, I could see the market more clearly and I proceeded to place by buy entry on the closest support level to the market.

And I placed my take profit on the closest resistance level to the market, just as seen above.

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CONCLUSION

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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.