The weekend proves sour for Axie Infinity (AXS) as bears broke below the 55-day simple moving average (SMA). Pushing the price further below $60.36, AXS bears set the next profit-taking level to $51.91.
As sentiment in Axie Infinity worsened over the weekend, price action has shifted to the south. In today's trading session, the supporting 55-day Simple Moving Average was broken to the negative at $64 and turned into resistance. Bears in Axie Infinity are looking to profit at $51.91 as the next profit-taking milestone.
Axie Infinity Price Action Could Dip to 14% Lower Value
According to FXStreet, Axie Infinity was in a bearish triangle at the time. Except for a brief breakout at the beginning of September, the declining trend line from August 21 has held price activity to the lower. As September progressed, buyers could not sustain AXS above $73.62 due to a lack of support for another run higher. Because that level no longer serves as support and has shifted to resistance, bulls have attempted but failed, to push AXS price back up to that level, resulting in the formation of a falling trend line as a technical feature.
This descending trend line has been used as a reference point by Axie Infinity bears. Around $72, sellers will take advantage of the opportunity to enter some large short positions, with a stop safely above the $73.62 highlighted level. Because these trades are currently profitable, the sellers will be hesitant to give up profits.
The breach of the 55-day SMA at $64 may have stung and wounded some bulls with the move to the downside and sellers waiting on their positions. They would likely stay on the sidelines as well, as they would wait to see how this short trade plays out before attempting to trade Axie Infinity once more. Profit-taking on short positions in AXS will occur around $51.91, which was the low on September 7 and appears to be a viable retest target, also shown in CoinGecko.
If buyers start purchasing the drop too soon, expect a probable reversal of AXS's today's negative price action. Even so, breaking the downward trend line will be challenging. Bulls will need a catalyst or an incentive to increase their long positions for sellers to be forced out of their stops and positions.
