Avalanche's stock ($AVAX ) faces increasing pressure as it declines, threatening to breach key support levels. With the RSI nearing the oversold area and price action hitting multi-month lows, investors are beginning to wonder: Is it possible for Avalanche's price to crash to $5? Let's analyze what the charts indicate and explore realistic scenarios.

AVAX price forecast: Is Avalanche's price facing a collapse or just stabilization?

Daily chart for #AVAXUSDT

At the time of analysis, the price of $AVAX was trading at around $18.00, having dropped by 2.34% during the day. This recent decline is part of a broader downtrend that started in late May, with the price sliding from the $24.00 area to its current levels.

On the Heikin Ashi chart, a strong sequence of red candles with tiny upper wicks confirms the continuation of bearish momentum. Unlike traditional candlestick patterns, the Heikin Ashi indicator helps to smooth price noise - and what we see here is a clear and controlled slide.

How low could the price of #Avalanche go? Key support areas

Support levels are crucial in assessing downside risk. Based on recent price action and historical demand areas, the price of #AVAX shows the following levels:

Immediate support: $17.73 (tested today)

Next major support: $15.20 - Previous consolidation area

Critical support: $13.40 - Main horizontal level from the March low

Breakdown support level: $8.00 - Last line of defense before potential free fall

If the price of AVAX decisively loses the $17.73 level, the measured move suggests a drop of at least $2.50 towards $15.20. This represents a -13.8% correction from current levels. If this level breaks, the next drop of 15-20% could take Avalanche's price near $13, opening the door to the scary long-tail scenario of $5 - especially if Bitcoin corrects sharply or macroeconomic risks escalate.

What does the Relative Strength Index (RSI) tell us about trend strength?

The Relative Strength Index (RSI) is currently at 32.20, touching the oversold threshold of 30. This indicates that downward exhaustion is imminent but not yet confirmed. More importantly, the RSI has been in a sustained downtrend, consistently recording lower highs and lower lows - indicating weak buyer confidence.

It is also worth noting: The average RSI (yellow) is above the RSI line, confirming bearish momentum. In short, there is no bullish divergence yet. The price of Avalanche is not ready for a significant bounce.

AVAX price forecast: What would it take for AVAX to collapse to $5?

A drop to $5 from its current price of $18 represents a -72% decline. For this to happen, we need:

Total cryptocurrency collapse - for example, Bitcoin's price dropping below $45,000 and Ethereum losing the $3,000 support level.

Special news about AVAX - such as a DeFi protocol breakthrough on Avalanche or developer exits.

Market-wide panic selling - caused by regulation, black swan events, or recession signals.

Using Fibonacci extension from the peak at $24 to the support level at $13.40:

Extension 1.618 = $7.50

Extension 2.618 = $4.80

So, technically, reaching the $5 level is only possible if the price drops below all support levels, and sentiment completely collapses.

Is there hope for a bounce?

Not everything is bleak. If the price of AVAX holds at $17.73 and closes a strong green candle with volume, a short-term bounce towards $20 is possible. A clear breakout above $20 would invalidate the downtrend and could restart the climb towards $22-$24.

But for now, it is clear that the momentum is against the bulls. Until a higher low and a reversal in the RSI occur, any bounce is likely to be short-lived.

Final verdict: Should you be worried?

Yes - cautiously. The price of AVAX is walking a tightrope. The stock hasn't collapsed yet, but if it breaks the $17 level with volume, its next likely price range will be between $15 and $13. While reaching $5 is not imminent, it is possible if market conditions deteriorate further.

Key levels to watch:

$17.73 - Hold or break

$15.20 - Warning area

$13.40 - Critical turning point

$8.00 - Strong support before a potential drop to $5

For now, patiently wait and look for confirmation signals. Smart traders await volume, not hope.