Axie Infinity: Assess upside potential at this support level


As they step up their efforts to ease the sell-off, buyers finally found credible support at the $28.9 level. Axie Infinity (AXS) marked a downward channel (white) in the daily timeframe, while the recent retracement lifted the Alt to a several-month low.

After facing a hurdle at the upper boundary of the downward channel, the bearish will aim to retest the strength of the $28 baseline. At press time, AXS was trading at $32.397, up 10.43% in the last 24 hours.

AXS daily chart

Source: TradingView, AXS/USD

From the 25th of March, the AXS continued to form lower highs and lower lows. Descending channels mapped this devaluation to the daily time frame. The decline continued until the nine-month low on April 30th.

Buyers moved higher on the last day while the $28 mark coincided with the lower trendline of the downward channel. However, the upper bound of the current pattern has limited this recovery. The seller refrained from yielding the driver’s seat. 20 EMA (red) still continued the journey south.

Giving significant importance to the current trend, there is a possibility of a retest of the $28, which could put AXS into a tight phase near immediate support. Any closing prices above the pattern could ignite long-term recovery hopes. This break could allow AXS to challenge the $37 resistance limit near the 20 EMA.

rationale

Capture 14 scaled

Source: TradingView, AXS/USD

The RSI’s figures resonated with the recent easing of selling pressure. While oscillating just above the oversold indicator, it still had to find a close above the 36 resistance level to lay the groundwork for a breakout rally on the alt chart.

The bearish divergence of the CMF along with the price reaffirmed the possibility of a short-term retreat on the chart. During the past five weeks of consistently swinging below the zero line, buyers have had to play games to increase their purchases.

conclusion

Given current market dynamics, a possible test at the $28 level could push the AXS into a squeeze phase. This forced buyers to look for a revival rally that crossed the current pattern to re-ignite a long-term recovery opportunity towards the $37 level.

Ultimately, altcoins share an 88% 30-day correlation with Bitcoin. Therefore, keeping an eye on Bitcoin’s movements is essential to making profitable moves.

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