- Solana and Avalanche prices have come under intense pressure lately.
- Bitcoin price has found a strong support at $25,300.
- A drop below that level will see AVAX and SOL plunge below $10.
Altcoin prices have retreated in the past few weeks as investors assess the impact of the SEC lawsuit against Binance and Coinbase. Investors are worried that many exchanges that serve American customers could delist many tokens. Solana price has dropped to $15.08, lower from last week’s high of $22.28. Avalanche price, on the other hand, has dropped to $11.80, lower than this month’s high of $15.
Bitcoin price sits at a key support
Most altcoins have struggled to find direction recently because Bitcoin price has moved sideways in the past few days. As shown on the daily chart below, Bitcoin has struggled to move below the important support level at $25,300.
This is an important level where it has failed to drop below since the month started. It is also an important level since it sits at the 23.6% Fibonacci Retracement level. Therefore, as I wrote here, a move below this support will likely open the probability of Bitcoin price falling to the next psychological level of $20,000.
Therefore, buyers should try harder to ensure that this does not happen since it will send a signal that there are more sellers in the market. Fortunately, there is a catalyst that could help Bitcoin resume the bullish trend.
First, as I wrote in this article, the US published encouraging consumer inflation data on Tuesday. The data revealed that the country’s inflation dropped to 4.0% in May while core CPI dropped to 5.3%. As such, there is a likelihood that the Fed will decide to leave rates unchanged, which is a positive thing for Bitcoin.
The other catalyst for Bitcoin is that the recent lawsuits could push more altcoin investors to Bitcoin because regulators agree that it is not a financial security.
Avalanche and Solana correlation with BTC
As shown below, Solana and Avalanche prices have a close correlation with each other. In most cases, AVAX price tends to rise when SOL is rising and vice versa. At the same time, these altcoins have a close correlation with Bitcoin, the biggest coin in the world.
Therefore, SOL and AVAX recovery will depend on the performance of Bitcoin, which sends the tone for the broader market. If Bitcoin moves below the support at $25,300, it means that the two altcoins will continue falling.
Therefore, in this case, Solana price will drop from the current $15 to about $10. On the other hand, Avalanche price will slip from $11 to about $8.
