June was a devastating month for crypto investors. But despite this, we are seeing some recovery as the major coins build modest upward momentum. AVAX is no different, and the coin has now managed to recover an important support zone after crashing in June. So where will he go next? Is the rally temporary or permanent? Here are some highlights:
AVAX had fallen almost 65% in June alone.
However, the coin has rebounded over the past two days with a 15% gain in 24 hours.
More importantly, AVAX reclaimed the $14 support.
Data Source: TradingView
Where will Avalanche go from here?
Well, many scenarios are in play here. First, the rally we’ve seen by AVAX over the past couple of days is consistent with a broader market recovery. This could suggest that we may be seeing some short-term relief after last week’s sell-off. If so, then AVAX could lose its upward momentum very quickly.
The good news though is that the coin is now trading above the $14 mark. For the most part in 2022, this support has remained strong even in the face of massive bear pressure. So, even if the coin were to pull back from its current 2-day rally, the bulls will have a better chance of defending the $14 mark than they did a week ago.
However, failing to hold $14 could mark the start of a major downside for AVAX. In fact, after $14, the only other real support is at $10.70.
Why AVAX still poses major risks?
Despite rising above the $14 mark, we still see major risks with AVAX. First, the coin has struggled over the past few weeks to maintain momentum above $20.
As such, we expect it to start to lose momentum as it pushes towards $20. This could lead to a sharp pullback that ultimately puts the $14 support under real threat.