AVAX is retesting the $16 Fibonacci level as price attempts to hold support after recent wedge breakout.
If bulls defend $16 then targets include $26.78 $32.36 and $37.94 based on Fibonacci retracement levels.
A close below $15.50 could invalidate the bullish structure and shift market focus to lower price ranges.
Avalanche (AVAX) is retesting the 0.786 Fibonacci retracement zone near $16 after breaking out of a falling wedge on the weekly chart. Price currently trades near $18.97, down 9.84%, with the market now watching if support around the $16 area holds. If this level sustains, the next resistance targets are $26.78, $32.36, and $37.94 respectively.
Source: X
The pullback has brought AVAX back toward the major support region, critical for determining its next direction. Fibonacci levels have played a significant role in guiding past reversals, and the 0.786 level now marks the zone where bulls must defend. Market participants are now asking: will AVAX hold the $16 support and rally, or sink below $15.50 and extend its losses?
Falling Wedge Breakout Sets Stage for Possible Rally
AVAX recently broke out of a long-term falling wedge pattern on the weekly timeframe. This technical pattern is typically a bullish signal, especially when paired with a test of Fibonacci support. The current retest near the 0.786 Fib suggests a potential continuation to the upside, if buyers step in.
The falling wedge began forming in early 2025, with a series of lower highs and lower lows compressing price action into a narrowing range. In early June, AVAX broke above this pattern, sparking speculation about a sustained reversal. However, prices soon pulled back and are now testing the lower boundary again.
This retest is viewed as a technical retouch to validate the breakout. If price maintains above $16, traders may consider it a confirmation of bullish structure. Past performances of such patterns often lead to a reversal when followed by volume increase and firm support.
Upside Targets Aligned With Fibonacci Retracement
If support at the $16 area remains intact, AVAX could push toward key resistance levels based on Fibonacci retracement. The first target is $26.78, which aligns near the 0.382 Fib level and could serve as initial profit-taking territory. Beyond that, $32.36 and $37.94 represent deeper retracement points if momentum builds.
These levels serve as natural hurdles where previous consolidation and selling occurred. Traders often watch such retracement zones closely for potential reversals or breakouts. Each level is spaced to reflect meaningful psychological price markers in previous AVAX cycles.
At present, all projected targets stand well above the current price, offering a clear roadmap for recovery. However, these levels remain valid only if the $16 support does not break. A strong weekly close above $20 could strengthen bullish sentiment and attract renewed interest from market participants.
Caution Advised Below $15.50 Support Zone
While bulls are eyeing upside, a drop below $15.50 may signal renewed weakness and invalidate the current bullish breakout setup. That level marks a structural floor, and any breakdown could trigger further selling. Weekly close below this zone could encourage sellers to regain control.
Caution is advised at this stage, as multiple failed support tests in this area would suggest buyer exhaustion. The market may then revisit previous lows or even form new ones if volume increases on the downside. Traders should monitor price reaction closely in the $15.50 to $16 range.
Volume and weekly candle structure will remain key indicators in determining short-term momentum. Until a decisive move is confirmed, the market could remain range-bound. Patience and precision are crucial as AVAX navigates this critical retest on the chart.
