The price of Axie Infinity (AXS) is down nearly 30%, two weeks after losing $625 million in a hacking incident involving the Ronin Network, the underlying blockchain of its play-to-earn gaming platform.
AXS/USD fell to $46.69 on Monday, its lowest level since March 16, indicating a decline among traders and investors following the hacking incident.
Independent Market Analyst TJ emphasis on That there is “no sign of buyers”, even in areas with a history of attracting depositors in price-entering areas.
For example, AXS broke below a demand zone that TJ highlighted as a potential inflection point over the weekend, a move that risks sending the price further lower towards its range support target near $45 this week. raised.
AXS bounce back and forth?
The recession appears likely despite a strong assurance from Sky Mavis — the company that created Axi Infinity — that they will reimburse all users who lost money in the $625 million theft. Last week, the company announced a $150 million raise led by Binance to fulfill its promise.
Additionally, AXS signals further downside after drawing a death cross between its 20-day exponential moving average (20-day EMA; green wave) and its 50-day EMA (red wave).
The area around the $45-level previously acted as an accumulation zone for traders. For example, its last retest of support as support in March went to around $75 before rallying around 70%. Similar retracement moves occurred in January and February when the price dropped to around $45.
Meanwhile, as AXS tests key support levels, it will also prompt its daily relative strength index (RSI) to move below 30 – an “oversold” signal. This suggests that the Axie Infinity could be due for more bounce in April.
Falling Wage Confirmation Required
AXS price is already “oversold” on its four-hour chart, with its RSI reading near 25. Meanwhile, AXS is breaking down from its prevailing falling wedge pattern, although it is theoretically a bullish reversal pattern.
Support confluence – featuring an oversold RSI and accumulation area near $45 – boosts AXS’s potential to re-enter the wedge range, followed by an upside breakout.
If this happens, AXS/USD could move towards $58, a key resistance level as of March 2022, based on a theoretical profit target of a falling wedge, which is placed between its upper and lower trendlines at the breakout point. The distance is measured after adding up.
head and shoulders risk
Conversely, a break below a key support area near $45 could trigger a head-and-shoulders (H&S) setup for AXS on the longer time frame chart.
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This is mainly because the $45-level acts as the neckline of the pattern. As a rule, a break below the H&S neckline support moves the downside target of the asset to a level equal to the maximum distance between the head and neckline, as shown in the chart below.
As a result, the H&S setup risks sending AXS price towards $12 on a decisive breakout below its neckline.
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