Whether Axie Infinity [AXS] will go this way or that will depend on…

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice

Axie Infinity [AXS] has finally provoked a series of higher peaks on a streak of bullish engulfing candlesticks after its pennant’s breakdown.

Due to recent developments on its platform, AXS did relatively well by outperforming most of its peers over the last two days.

Despite a reversal from the $27-level, the altcoin’s hike above the basis line (green) of Bollinger Bands (BB) has flipped the 20 EMA (red) to support. A potential bounce-back could help AXS test the lower boundary of the Pitchfork in the coming sessions.

At press time, AXS was trading at $22.421, down by 8.88% in the last 24 hours.

AXS 4-hour Chart

Source: TradingView, AXS/USD

The crypto has resonated with the market-wide trends for the most part until recently. After dropping below some crucial price points, the altcoin sailed around the $20-baseline near its Point of Control (POC, red) for two weeks.

Furthermore, AXS registered a bearish pennant after a steep flagpole on the 4-hour timeframe. The recent down breakout pulled the coin to retest the long-term $17-floor before the buyers swopped in. As they evoked a substantial uptick in buying volumes, the altcoin registered a 60% incline between 30-31 May.

With the basis (green) and the POC currently coinciding at the $21-level, AXS could find a bounce-back opportunity. Also, the 20 EMA and the 50 EMA (cyan) undertook a bullish crossover after two months.

A close above the lower fence of the Pitchfork would open up a doorway to retest the upper band of the BB. The altcoin could enter a relatively tight phase in the $20-$22 range if the bulls dwindle.

Rationale

Source: TradingView, AXS/USD

The RSI’s equilibrium has flipped itself back into support after the buyers visibly exhibited their edge over the current dynamics. A recovery from its immediate trendline resistance would affirm a near-term bullish divergence with the price action.

Having said this, investors/traders must keep an eye on the MACD lines. A convincing bearish crossover can delay the short-term recovery prospects. 

Conclusion

In light of the 20/50 EMA bullish crossover alongside the north-looking basis line, AXS can rebound from the $21-zone. A close above the Pitchfork would affirm the possibility of a sustained rally towards the $27-$28 range.

Before entering calls, investors/ traders should consider the MACD threat to minimize risk.

However, it becomes vital to note that the altcoin shares a 93% 30-day correlation with Bitcoin. Thus, keeping an eye on Bitcoin’s movement would be essential for making a profitable move.