AXS shows some short-term strength but a resolute resistance zone looms ahead

Disclaimer: The results of the following analysis are the only opinions of the writer and should not be considered investment advice.

Bitcoin [BTC] it has fluctuated between $ 20k and $ 19.9k in the twelve hours prior to printing. In recent days it has failed to recapture the $ 20.4k to $ 20.5k region as support. The short-term bias for Bitcoin was bearish and a review of the $ 19.2k threshold could materialize.

Despite this scenario, Axie Infinity [AXS] it had an upward momentum and looked set to post some gains in the next few hours. Caution was advised and a risk-averse trader could wait for AXS to reach resistance to short the asset rather than enter a long position.

AXS- 1 hour chart

AXS shows some strength in the short term, but a resolute resistance zone looms

Source: AXS / USDT on TradingView

The one-hour chart has shown considerable volatility over the past few weeks. For most of the past two weeks, AXS has been trading between the resistance of $ 14.84 and the support of $ 13.2. The ascending cyan trend line has also served as support in the past few days.

The price managed to cross the $ 14 threshold and flip it back to support (cyan box). A retest of this area could offer a buying opportunity with a tight stop-loss just below $ 13.77.

The $ 14.8 region (red box) and the $ 15.4 region can be used to make a profit. However, given the uncertainty behind Bitcoin, aggressive profit-taking could be beneficial. The weekend has arrived and the drop in liquidity could see big moves in a short amount of time.

The 21 and 55 period moving averages have intertwined on each other over the past few days to highlight the lack of strong momentum.

Rationale

AXS shows some strength in the short term, but a resolute resistance zone looms

Source: AXS / USDT on TradingView

The Relative Strength Index (RSI) rallied above neutral 50 the previous day. However, it hasn’t really breached the 60-65 region in the past week. So, it was possible that another foray into 65 might see an AXS pullback.

An encouraging observation for the bulls was the formation of higher lows on the On-Balance Volume (OBV). Buyers were slightly stronger last week, but the OBV has not yet been able to break the resistance. A move above the resistance, combined with a move above $ 14.84, could usher in a strong upward move for AXS.

Conclusion

Short-term price action highlighted that the $ 14 move to support meant a likely move to $ 14.8. The trend line (cyan) can also be expected to act as a support. To the north, $ 14.8 and $ 15.4 are significant resistance zones. Aggressive profit booking may be the safest route for a bullish trader.

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