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.

Getting to the weekly timeframe, I noticed that the candles on this timeframe are more than those on the monthly timeframe.

And looking carefully, I was able to spot a key level and this level will be functioning as a resistance level to the market.

And it can be said to be a valid level because it has been respected by the market, and we can expect for it to be rejected again when the market gets to this level.

Also, I noticed that the most recent bearish leg of the market was as a result of rejection from this resistance level, which shows the strength of the resistance level.

And getting to the daily timeframe, I realized that this market is more noisy, and the buyers and sellers are struggling 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 looking carefully, I noticed that the market is forming lower lows and lower highs, and it has approached a support level, and I expect to see a bullish rejection of the market.

And from the above screenshot, I can see a bulllish rejection on the market , and from this, I can place a buy order on the market.

Getting to the 4hr timeframe, I realised that the noise in the market keeps increasing as we goi down the timeframe.

And on this timeframe, I could see the market more clearly, and I noticed that the market is retracing to retest this support level, and when it does, I can take a buy on the market.

This analysis have given me a bullish bias of the market, and I have decided to move to the 2hr timeframe in search of entry.

On the 2hr timeframe, I realised that the market has made several touches on this support level and has been unable to break below this level.

Again, I expect the market to properly test this level, and when it does, I can take my entry into the market.

And before this, I decided to search for confluence using the rsi 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.

Applying the rsi to the monthly timeframe, I realized that the monthly market is being oversold, as the rsi is gradually approaching its 20% level.

An oversold market is one that signals a bullish trend reversal of the market, that is, the weakness of the bears and the strength of the bulls.

And as such, we can expect to take bullish entries into the market and this is in alliance with my analysis using support and resistance strategy.

And getting to the daily timeframe, I also noticed that the market is being oversold, as the rsi has gotten to its 20% line.

And as explained earlier, it is a market, signaling a change in market strength from the seller to the buyers, and upon the formation of bullish candles, we can take our bullish entry on the market.

I then decided to move to the 2hr timeframe, as it is on this timeframe I can take my entry into the market.

On the 2hr timeframe, I noticed that the rsi has crossed above its 80% line, which is indicating an overbought market.

And as a result, we expect to see a momentary bearish retracement of the market into its support level before we take our bullish entry.

I then proceeded to place my bullish entry on the closest support level to the market and my take profit was placed on the market closest resistance level, 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.