AVAX Relief Rally May Be Short-Lived Amid Weak Spot Buying

Avalanche's recent short-term relief rally has sent mixed signals to investors. The altcoin saw a 5.95% surge in the past 24 hours, making it one of the few tokens among the top 50 crypto assets by market capitalization that gained value recently.

However, this upward movement was accompanied by a nearly 8% decline in daily trading volume, indicating weak spot buying and a fragile bounce. The increase in Open Interest at only 3.3% further suggests speculative traders' reluctance to chase the move.

A closer look at Avalanche's long-term price trends reveals that it bounced back from oversold conditions made earlier in June. In February, AVAX set a swing low at $7.55, which it breached in the first week of June.

The 4-hour structure was firmly bearish, and AVAX's bounce has strayed into the golden pocket between the 61.8% and 78.6% retracement levels plotted based on this timeframe's swing move. This is a clear sell signal, according to analysts.