Is Avalanche ($AVAX) gearing up for a comeback? After a significant drop, shedding 26% in the past 7 days, investors are wondering if AVAX is prepping for a recovery. Avalanche has emerged as a leading Layer-1 blockchain, positioning itself as a strong contender to Ethereum by providing enhanced efficiency. But can it bounce back?

According to key metrics shared by top analyst Ali Martinez, Avalanche is showing promising signs of a potential rebound. Martinez highlights that a key technical indicator suggests a potential shift in momentum for AVAX. However, the path forward isn't guaranteed.

The AVAX price movements indicate that the token has already undergone a major breakout from the pattern that started forming in November of last year. This breakout, if sustained, could pave the way for a significant price increase. But first, it needs to hold its ground.

On Monday AVAX tokens exist on the X Chain and can be traded there, while on the C Chain, they can be used in smart contracts or to pay for gas. This dual-chain functionality adds versatility to the AVAX ecosystem.

Now, as highlighted below AVAX is testing the critical support level at $20, which could determine its ability to hold steady. The token may be in a corrective phase, with immediate support at $19.80 and broader support levels needing careful monitoring. Will AVAX hold this crucial support and signal a recovery, or will it face further downside? Keep a close eye on AVAX price action for clues to its next move.