Avalanche (AVAX) has experienced a notable recovery in its price over the past week, closely following the impressive rally of Bitcoin. The digital asset has seen a gain of nearly 16% within the last week and over 22% year-to-date. However, despite these recent gains, AVAX is still struggling to fully recover from the losses it incurred over the last month, as it remains 8.72% lower during this period.
In terms of fundamental analysis, the rally in Avalanche price can be attributed to the bullish sentiment prevailing in the overall cryptocurrency market. Data provided by Coinmarketcap indicates that the global cryptocurrency market has increased by 1.63% over the past 24 hours, reaching a valuation of $1.19 trillion. However, the total crypto market volume has experienced a slight decline of 4%. Moreover, Bitcoin’s dominance in the market has reached 50%, its highest level since the beginning of the year.
Despite the regulatory crackdown on cryptocurrencies and ongoing macroeconomic uncertainties, the cryptocurrency market has displayed strong bullish momentum. The breakout of Bitcoin above the critical resistance level of $30,000 has further bolstered positive sentiment in the industry. At the time of writing, Bitcoin is trading at $30,699.
Market participants are eagerly awaiting statements from global central banks, especially in light of the upcoming release of the US and UK Gross Domestic Product (GDP) data for the first quarter. There are expectations of a decline in US economic growth, with forecasts indicating a drop to 1.4% from the previous reading of 2.6%. On the other hand, the UK’s quarterly GDP is expected to remain unchanged, while its yearly economic growth is predicted to slip to 0.2%.
Investors are particularly interested in comments made by the Federal Reserve Chairman, Jerome Powell, as they seek fresh hints regarding the Fed’s interest rate trajectory. Additionally, Wall Street has paid close attention to the June consumer confidence report, which showed a surprising increase for the month. The Conference Board Consumer Confidence Index rose to 109.7 in June, up from 102.5 in May and reaching its highest level since January 2022. The Expectations Index, which measures consumers’ short-term outlook for business, income, and labor market conditions, also rose to 79.3, slightly below the threshold of 80 associated with a recession within the next year. An upcoming focus will be on the release of the personal consumer expenditure (PCE) index report on Friday.
Moving on to technical analysis, the daily chart for Avalanche price reveals a strong upward trajectory over the past few weeks. However, the digital currency has been unable to surpass the 50-day and 200-day exponential moving averages, as well as the 50-day and 100-day simple moving averages. Additionally, it has struggled to break through the significant hurdle at $15.
Despite these challenges, the Relative Strength Index (RSI) for AVAX has risen into the neutral zone, while the Moving Average Convergence Divergence (MACD) indicator suggests a bullish trend. The Momentum indicator also indicates a bullish outlook.
Based on these technical indicators, it is expected that Avalanche price will continue to rise in the short term as buyers target the next resistance level at $15. A successful move past this level could sustain the current bullish trend. Conversely, if the price falls below the support level of $12.60, it would invalidate the bullish thesis.
In conclusion, Avalanche has witnessed a significant recovery in its price in recent times, although it still grapples with losses incurred over the past month. The bullish sentiment prevailing in the cryptocurrency market, along with positive developments in Bitcoin, has contributed to this recovery. Looking ahead, investors will closely monitor central bank comments and GDP data as they seek indications of economic performance and future interest rate policies. From a technical standpoint, the Avalanche price is expected to continue its upward trajectory, with resistance levels at $15 acting as a key target for buyers. However, caution should be exercised, as a break below the support level at $12.60 would challenge the bullish outlook.
