AVAX price action bounces as cat out of bag on Binance’s takeover of FTX
|- Avalanche price action jumps over 8% during the European trading session.
- AVAX price action sees buying as the RSI bounces off the oversold barrier.
- Expect some recovery, but not a full one, as crypto needs to repolish its image first.
Avalanche (AVAX) price action has had a beating these past two trading days and was knocked out against the canvas at the US close on Wednesday. The risks and negative sentiment that follow after the farce of Binance’s announced takeover of FTX and then subsequent backtracking will have caught the attention of the US Congress and the SEC once again. Expect another wave of regulatory crackdowns and possibly an FBI investigation into FTX as events unravel further in the coming weeks.
AVAX price got upside, but limited
Avalanche price action is primed to make at least some recovery, as bulls are scooping up the coin near $12 as a new 2022 low was printed overnight. The current recovery of 9% during the European session looks tempting to be apart of. Smart traders will rather think ahead and only trade the rally short term. The saga between Binance and FTX will have drawn attention from Washington and several oversight agencies.
AVAX price thus will face a louder and tougher call for more regulations in the US since this PR crisis comes only months after the LUNA stablecoin meltdown. Recovery is possible toward $16, with the monthly S1 support level now becoming resistance. Should it give way, the 55-day Simple Moving Average (SMA) near $17 will be key as it will act as a price cap and entry level for the bears.
AVAX/USD daily chart
From the looks of it, AVAX price action is already having difficulties continuing its recovery. The $14.56 level, which bears the lows of October, is already providing some resistance and pushback against bulls from trading higher. The risk with the US inflation numbers later today could be that inflation remains elevated and price action turns south to test the year’s low at $12.06, with a break and dip toward $10.53 at the monthly S3 support level.
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