Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
The buying pressure behind AXS dried up according to indicators. Momentum and structure remained bullish.
Axie Infinity [AXS] posted gains of 138% from swing low to swing high of January as of this writing. The token’s performance meant sentiment in the bull camp was euphoric. Still, there were suggestions that the buyers were running low on ammunition.
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Bitcoin [BTC] held at the $23k level at time of writing and further gains seemed likely. The bullish sentiment may also push AXS higher. The question remained, will buyers get a decent pullback to enter long positions?
Inefficiency Has Fibonacci Retracement Confluence, But Will There Be A Dip That Far South?
Momentum was strongly bullish behind AXS in January. It broke the market structure on the daily chart and turned it to bullish on January 9, when the price skyrocketed to close out the daily trading session at $7.32. The recent low was $7.25 on Dec. 22.
In early 2023, the OBV registered a massive upward move. This indicated a huge amount of buying and the break in the market structure reinforced the bullish bias. A series of Fibonacci retracement levels were drawn based on the bullish move.
How much are 1,10,100 AXS’ worth today?
The $10.2 pullback nearly reached the 61.8% retracement at $7.52 before moving higher to $13.94. The OBV did not go higher, the RSI did. This was worrying for the bulls, as the higher rally was not supported by any real buying pressure.
A study of shorter time frames such as four hours showed that the $11.22-$11.4 area was supported. The $10.8-$11 area was a short-term liquidity zone and the price could revisit it before moving higher. A four-hour session close to $10.8 would likely precede a pullback as far south as $9.3.
See CVD in Decline as Open Interest Indicates Bullish Strength
While the OBV failed to make a higher high alongside price, the spot CVD suggested bearish pressure. The continued downtrend of the CVD over the past few days showed steady selling pressure behind the asset. However, the Open Interest pushed higher with the price to indicate bullish intent.
Capital poured into the market and the funding rate was positive to show an optimistic sentiment. Even though the bears were not yet in effect, the lack of strong bidding power from the bulls may be concerning.
Since the structure and momentum were bullish, AXS traders can try to trade with the trend. A positive reaction near $10.8-$11.2 can be used to retake long positions in the event of a pullback.
This post Axie Infinity Blasts Past $10, Could Go Higher With No Significant Retracement
was published first on https://ambcrypto.com/axie-infinity-rockets-past-10-may-push-higher-without-significant-retracement/