AXIE INFINITY ABOUT TO BREAK FROM DESCENDING TRIANGLE?
Over the recent four weeks, Axie Infinity (AXS/USDT) has been in a bit of a short-term downtrend and currently it might be on the brink of a break out from a descending triangle, which has originated from the coin’s all-time high on the 6th of November. The token’s ongoing price action eerily resembles that of Solana’s latest correction, which started with its ATH on the exact same day as the AXS’s one, although the popular smart contract platform’s price has already broken from its triangle and SOL (SOL/USDT) is looking ready to face the challenge of testing its nearest resistance, once again, starting around the $230 mark.
RSI on the daily is exactly at 50, which clearly indicates indecision, but the Histogram bars on the MACD have been rising over the recent week and we could see a bullish crossover with the MACD line breaking above the Signal line, potentially in the next couple of days. Following the previous time that we saw a similar bullish crossover in this asset’s chart, the price appreciated from around $63 all the way up to $136 and that increase in value, by more than 110%, only took it 18 days.
AXS MORE LIKELY TO BREAK TO THE DOWNSIDE
Right now, however, the Axie Infinity coin’s price action is visibly struggling to get the better of its nearest resistance at approximately $135 and, in addition to that, there is an extra hurdle to jump over in the form of the 50-day Moving Average, which has acted as tough resistance since the 18th of November. So, all in all, there is a negative confluence of three lines: the descending upper trendline of the triangle, the short-term 50MA above AXS’s price action and the $135 area, which acted as a rejection point on multiple occasions for the most part of October before getting flipped into support on Axie’s way to set the present ATH at $166, nearly a month ago.
In the short-term worst-case scenario, we might see the AXS get rejected again, followed by another test of its well-established support area between $120 and $122. That crucial support has held for almost two entire months now, so we can imagine that there will be many potential investors and swing traders ready to get involved in the action at such relatively low prices. Buying in at levels that are 25% lower than an asset’s all-time high often constitutes a reasonably profitable option, especially in tokens that are part of the hottest trending category, the metaverse in Axie’s case.
At the moment, the best-case scenario would be for the play-to-earn crypto to break from this descending triangle to the upside and confirm the positive momentum by going above its next area of resistance at $145, which won’t be an easy task, as the token got rejected from that level five or six times in the previous two months. In order to complete this job, Axie Infinity, which is presently the 24th largest cryptocurrency by market capitalization ($8.8B at its latest value of $134 per unit), could use some kind of help in the form of increased buying pressure resulting from, for instance, one or more emerging pieces of news on the asset.
All in all, the cryptocurrency market as a whole has been in a fairly tricky situation since the beginning of November, so that will naturally continue to be the main factor that will decide the momentum and the direction of movement for pretty much all tokens’ prices in the coming weeks. The metaverse-related assets have, in general, performed distinctly better than the other tokens, so for those investors who have missed out on the digital world’s coins so far, this possible short-term farther correction, which we could see soon, might just make up the last opportunity to hop on board of this red-hot cryptocurrency trend.
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