Axie Infinity: This is where AXS can go if no buyers are involved.


Axie Infinity in almost two months [AXS] Finally, the two weeks continued to record high lows. However, the bears have withheld influence over the altcoin peak for several weeks.

As the current stage tightens, AXS is entering a significant area that could determine the fate of the upcoming rally.

The $20 area assumed significant materiality, potentially triggering a downtrend. A close below the Pitchfork lower bound would indicate a short-term setback for AXS.

At press time, AXS was trading at $20.697, down 1.76% in the last 24 hours.

AXS 4-Hour Chart

Source: TradingView, AXS/USD

Since early April, AXS has followed in the footsteps of Kingcoin, reverberating in the liquidation of the entire market. After dropping below a few key price points, alt sailed around the $20 baseline near the control point (POC, red).

The recent downtrend continued on May 11th from the $16 area to a 10-month low. Although buyers have shown resilience, they have failed to spur the uptrend in volume trends.

The 20 EMA (green) and POC are currently matching at the $21 resistance, so AXS may find it difficult to lead the uptrend. The past two weeks have also been bearish after a four-hour steep flagpole.

In general, a bearish pennant breakout is more effective at reducing trend volume. As you can see, the trending volume of AXS plummeted while the current pennant was forming.

Thus, a robust closing close below the lower boundary of Pitchfork will expose the AXS to a potential downswing. The bears will aim to test the $16-18 range before there is a bullish comeback opportunity. Given its high correlation with Bitcoin, AXS could abandon its bearish structure if Kingcoin suddenly rises.

rationale

Capture 54 scaled

Source: TradingView, AXS/USD

The RSI’s balance shifted back to resistance mode after the sellers had a noticeable edge in their current structure. If the bulls maintain their 41-line support, AXS can see an extended squeeze phase on the chart.

As -DI looks north again, prospects for a near-term bullish recovery appear relatively slim. Moreover, ADX indicated a weak direction for altcoins.

conclusion

A bearish breakout was highly probable given the bearish pennant along with the declining trend in volume. In this case, traders should be wary of test support in the $16 area.

However, it is important to note that altcoins share a 94% 30-day correlation with Bitcoin. Therefore, keeping an eye on Bitcoin’s movements is essential to making profitable moves.

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