The avalanche recovery (AVAX) has extended its third week, mainly after a similar bullish upturn in major cryptocurrencies.
On Thursday, the price of AVAX rose by around 16% to $ 96.50, the best level since January 14, 2022. The massive intraday movement was part of an improvement that began on January 22 after the avalanche token reached the bottom of around $ 53. As a result, AVAX’s net return exceeded 80%.
AVAX / USD daily chart. Source: Trading View
Network growth outweighs macroeconomic problems
The cryptocurrency markets have been hit since the beginning of 2022 when investors weighed in on the prospect of tightening the US Federal Reserve’s monetary policy. After reaching an all-time high of over $ 150 in November 2021, AVAX lost as much as 65% of its value during what many called the “crypto winter.”
Similarly, leading cryptocurrencies Bitcoin (BTC) and Ethereum (ETH) are down 52% and 57% respectively from their records in November 2021. But they have recovered almost half of their losses since reaching their lowest levels in late January. 2022, which caused other cryptocurrencies, including AVAX, to reach similar recovery heights.
The price of AVAX also skyrocketed when Avalanche, an independent blockchain project, announced significant network growth at the end of 2021.
This included an increase in its daily active addresses to 70,000 per day in Q4 vs. 10,000 per day in Q3 and a 714% increase in Total Value Locked (TVL), the fastest growth among the team’s competitors. 1 and level 2 – after the emergence of the Leading, Aave and Curve protocols in the Ethereum ecosystem.
Avalanche 2021 total value unlocked compared to competitors. Source: Trading View
Interestingly, the avalanche network rose in the fourth quarter despite a decline in net market value during the same period, indicating that AVAX only reacted to the turmoil in the cryptocurrency, and thus global markets, caused by the so-called Fed tantrums.
But the report, co-authored by Messari researchers Chase Devens and James Trautman, suggests wider use of AVAX in upcoming quarterly sessions. Avalanche Rush, a $ 180 million catalyst program launched in August 2021, is known for its ability to bring more members to the network.
The report said:
“While Avalanche Rush can continue to act as a catalyst for ecosystem growth and help launch new projects and partnerships, it threatens significant technological advances for Avalanche platform teams necessary for the network’s ability to support further growth.”
Technical display of Afax
On Tuesday, the latest uptrend in AVAX was met with sales close to the multi-month resistance to the downtrend line.
In particular, resistance is part of a downtrend channel. AVAX has trended lower within it since the start of a massive corrective move at the end of November 2021. As a result, the probability that the Avalanche coin will continue to fall into the channel area – for the time being – seems higher.
The daily AVAX / USD chart is marked with a bearish channel. Source: Trading View
An extended pullback after testing the channel’s upper trend line as resistance could push AVAX to temporary support at $ 86.50. A further crash will force AVAX / USD to target $ 72 as its next target.
Related: VanEck launches First Multi-Token Crypto Fund
Overall, however, the bearish target for AVAX appears to be on a pullback near the lower channel trend line, which is around $ 57.
Conversely, a decisive move above the channel’s upper trend line could cause AVAX to look at $ 104 as its next upside target, with a $ 135 skew in another pull.