AXS does not seem like a 'buy' even after falling 90% in the last seven months.
Notably, the U.S. consumer price index by an annual pace of 8.6% in May versus 8.3% in the previous month, heightening investors' fears that the Federal Reserve will be forced to hike interest rates aggressively in the coming months, which would push riskier assets lower across the board.AXS dropped 7.5% after the report came out on June 10, and fell by another 7% on June 11 to reach its three-week low of $16.79.
AXS plunged below $18-$19 support range this week, which was instrumental in capping its downside attempts since the beginning of May. Also, testing the range as support had followed up with a circa 800% bull run between July 2021 and November 2021, as shown below.Now, the path of least resistance for AXS looks skewed to the downside with the next downside target at around $9 by September 2022, more than 50% lower than today's price.
Conversely, a bullish cue comes from AXS's potential"descending broadening wedge" pattern on the weekly timeframe, confirmed by the token's fluctuation between two diverging, falling trendlines.Traditional analysts consider DBW as a bullish reversal pattern, which, as a rule of technical analysis, resolves after the price breaks above the structure's upper trendline and rallies by as much as the pattern's maximum height, as shown in the chart below.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
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