AVAX price crashed to levels last seen in early 2021 after a market-wide liquidation wave erased support near $8 and left traders heavily bearish. Summary AVAX price has fallen to levels last seen in early 2021 after a crypto-wide liquidation event wiped out key support zones. Open interest dropped to $159 million while more than 70% of derivatives positions remained short, highlighting bearish market sentiment. Traders are watching the $6.25 “Ultimate Support” level, with a break below potentially exposing AVAX to further downside toward $5.46 and $4.68. According to data from crypto.news, Avalanche (AVAX) fell 14% to an intraday low of $6.26 on Saturday, June 6, its lowest level since January 2021, before stabilizing at $6.64 at press time. The sharp decline came after Bitcoin (BTC) briefly fell below the key $60,000 support level and touched nearly $59,000, prompting traders to reduce risk as leveraged long positions were liquidated, and the Crypto Fear & Greed Index fell to 12 and remained in Extreme Fear territory, underscoring the deteriorating sentiment across the digital asset market. Source: Alternative Leverage flush leaves AVAX near early 2021 range The move was not driven by a clear Avalanche-specific network failure. Before the selloff, Avalanche had seen stronger institutional and on-chain activity, including more than $1.16 billion in on-chain real-world assets and the launch of regulated AVAX futures by CME Group. Those developments offered little protection once the market entered a forced deleveraging cycle. The additional context showed more than $1.86 billion in long liquidations across crypto derivatives, with high-beta layer-1 tokens such as AVAX absorbing sharper losses than Bitcoin. Derivatives positioning also weakened. Open interest in AVAX fell to about $159 million, showing fewer traders were willing to keep capital in active positions during the decline. At the same time, more than 70% of positions were shorts, leaving the market tilted toward further downside rather than a fast recovery. CoinGlass liquidation heatmap data shows heavy leverage above the current price, especially around $7.00, $7.50, $8.00, $8.50, and the $8.80–$9.20 zone. A rebound into those levels could trigger short liquidations, but current price action has not yet shown enough spot demand to force that squeeze. AVAX liquidation heatmap | Source: CoinGlass According to an earlier X post by analyst Dr. Chart MAZEN, AVAX still carries downside continuation risk unless buyers reclaim higher levels. “I have a classic continuation pattern for the downside in case the 8.20$ area breaks,” the analyst wrote, adding that he was watching “6.53” and “5.77” as lower areas. Source: X Technical setup keeps the bottom case fragile AVAX fell close to its final major Murrey Math support zone near $6.25 earlier today, a level labeled ‘Ultimate Support’ on the daily chart. The token previously lost the $7.81 and $7.03 support bands during the liquidation-driven selloff, leaving the $6.25 area as the key line bulls must defend to prevent a deeper decline toward the oversold region near $5.46. AVAX daily price chart — June 6 | Source: crypto.news At press time, AVAX was trading below both the 50-day moving average at $9.15 and the 200-day moving average at $10.66. Reclaiming those levels would be necessary to restore a bullish market structure, although the token’s defense of the $6.25 support zone has begun attracting attention from traders looking for signs of a longer-term bottom. Resistance now sits near $7.03, followed by $7.81 and $8.59. A close above $8.20 would weaken the downside continuation setup described by Dr. Chart MAZEN, while a stronger move above $10 would bring the 200-day average and major trend resistance back into focus. Downside risk remains clear. A daily close below $6.25 would keep sellers in control and expose AVAX to the -1/8 Murrey level near $5.46. Below that, the next major downside area sits near $4.68, while Dr. Chart MAZEN’s $5.77 level may act as the first test before deeper capitulation. AVAX can still form a bottom if buyers defend the $6.25–$6.50 range and force shorts to unwind above $7.50. Until price reclaims $8.20 with strong volume, the chart favors a damaged recovery attempt rather than a confirmed reversal. Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
