Avalanche (AVAX) Forms Double Top, Contemplating 25% Correction

• Avalanche price formed two equal highs at $127.69 on 30 November and 22 December, suggesting reversals.
• So far, AVAX price has lost 9% and might drop another 25% towards $90.79
• A daily candle close beyond the $127.69 double top will annul the bearish narrative.

Avalanche (AVAX) price has created a top reversal formation, suggesting the alt’s uptrend is about to end. Though bulls try to sidestep the fate, AVAX has the chance to crumble down soon.

Avalanche Eyes Lower Lows

Avalanche price printed two swing highs around $127.69 on 30 November and 22 December. That way, the crypto formed a double top reversal formation. Keep in mind that an uptrend reversal usually follows this pattern.

The anticipated bearish momentum will see Avalanche going down towards the closest support of $101.49. The downswing will translate to a 17% drop, but AVAX might not end the downward journey after that.

Breaching this barrier plus increased selling pressure will have AVAX falling towards 62.0% and 70.5% retracement areas at $95.24 and $90.78, respectively. That accounts for a total of 25% decline.

The worst-case might mean continuing its downward move, slicing vital levels to touch the $75.40 range low. A dip under this footing will be an opportunity for market makers to gather sell-stop liquidity.

Nevertheless, the altcoin might delay the bearish picture with an AVAX move to collect the buy stop liquidity beyond the double top pattern at $127.69. Though the liquidity run may be plausible, a daily candle close beyond it will show increased and consistent buying momentum, canceling the bearish tale. That way, Avalanche might surge 9%, retesting the hurdle at $139.34.

AVAX appears ready to explore a downtrend with the double top. The altcoin lost 9% and seemed prepared for a further 25% fall towards $90.79. With the downbeat that followed yesterday’s bullish waves, persistent down action in overall markets will support Avalanche’s downswings.

The alternative coin requires a daily candlestick close beyond the $127.69 double top to nullify the bearish narrative. That can depend on broad market price movements.

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