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.

I then continued my analysis by moving to the weekly timeframe, and on this timeframe, I could see the market more clearly.

I noticed that there are more candles on this timeframe than on the monthly timeframe, and I was able to spot a key level and this level is functioning as a resistance level to the market.

And this level can be said to be a valid level as it has been tested and respected severally by the market, and whenever the market trades towards this level, we can expect to see a bearish rejection on this timeframe.

I then moved to the daily timeframe, and on this timeframe, I could see the market more clearly.

I could see so much noise in the market, as the buyers and sellers struggle to show their strength in the market.

And looking carefully, I was able to spot another key level and this level is functioning as a support level to the market, and this level can be said to be a valid level as the market has respected this level severally.

And looking carefully, the market has traded towards this level already, and we can expect to see a bullish rejection on the market.

On the 4hr timeframe, I could see the influence of the sellers on the market, as the market kept forming lower lows and lower highs.

And looking carefully, I noticed that the market is aggressively trading towards my marked support level, and when the market gets towards this level, I can expect to see a bullish rejection of the market.

Since my entry is usually taken on the 2hr timeframe, I decided to move to the 2hr timeframe in search of entry.

On the 2hr timeframe, I could see the market more clearly, and I was able to identify a particular structure, which will be functioning as my take profit region.

With my bullish bias of the market, I decided to search for trading 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.

To begin this sector, I added my rsi to the monthly timeframe, and on this timeframe, I can see that the market is being oversold, as the rsi has crossed below its 20% line.

An oversold market is one understood to give a bullish trend reversal signal of the market, that is, it shows the strength of the buyers and the weakness of the sellers in the market.

And this is in alliance with my analysis using support and resistance strategy, and as such, I decided to move to the daily timeframe for more analysis.

On the daily timeframe, I looked and noticed that the market was also being oversold, and this is because its rsi has crossed below its 20% line.

An oversold market often indicates the weakness of the bears and strength of the bulls in the market, and as such, we can expect to see a bullish move in the market.

And to get my entry, I moved to the 2hr timeframe, as it is on this timeframe that I enter the market.

And getting to the 2hr timeframe, I could see the market more clearly and I noticed that the market is being oversold.

And as we know it, an oversold market is one that signals a bulllish trend reversal of the market, and as such, I decided to place my entry.

I then placed my entry on the closest support level of the market and my take profit on the closest resistance level on the market.

---

---

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.