Avalanche (AVAX) and Polkadot (DOT) were two of the biggest movers in the cryptocurrency market on Tuesday, February 28th, 2021. AVAX fell to a two-week low, as the token broke out of a key support point, while DOT extended its recent losses.
Avalanche (AVAX) slipped to a multi-week low on Tuesday, as prices moved below a key support point. Following a high of $18.62 to start the week, AVAX/USD dropped to a bottom of $17.39 earlier in today’s session. This move saw Avalanche hit its weakest level since February 13th, which is the last time prices were under $17.00.
From the chart, it appears that one of the catalysts for the drop was a breakout on the relative strength index (RSI). Price strength dropped below a floor at 43.00, and as of writing, the RSI is tracking at the 42.28 level. The next visible point of support seems to be near the 40.00 mark, and should this be hit, there is a strong chance that AVAX will move below $17.00.
In addition to AVAX, Polkadot (DOT) also extended recent losses, falling for a second straight session. DOT/USD moved to a low of $6.43 on Tuesday, after starting the week trading at a high of $6.78. As a result of today’s drop, DOT has now fallen for seven of the last eight sessions, dropping by over 11% in that time.
Like with AVAX, today’s sell-off came as the RSI broke out of a floor — in this instance the 48.00 zone. As of writing, the index is hovering closer to 47.00, with bears seemingly targeting a support point at $6.30. The 10-day (red) moving average is now firmly downward facing, which sums up the current momentum in the market.
It is clear that both AVAX and DOT have been affected by the recent market downturn. The global cryptocurrency market cap is down by 1.01% as of writing, and the effects of this are evident in the two tokens. AVAX has fallen below a key support point, while DOT has extended its recent losses.
The question now is whether these tokens can recover from these losses. For AVAX, the next visible point of support seems to be near the 40.00 mark, and should this be hit, there is a strong chance that AVAX will move below $17.00. For DOT, the support point at $6.30 seems to be the next target, and if this is hit, then the token could see further losses in the near future.
It is impossible to predict the future of the cryptocurrency market. However, it is clear that both AVAX and DOT have been affected by the recent downturn. The next few days will be key in determining whether these tokens can recover from these losses, or if they will continue to fall.
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Cryptocurrency is a highly volatile asset class, and it is important to understand the risks involved before investing. Image Credits: Shutterstock, Pixabay, Wiki Commons.
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