Synthetix price holds above critical support which could help SNX rebound to $26

Synthetix price took a nearly 60% nosedive as it fell in tandem with the rest of the cryptocurrency market. SNX is now holding above a crucial support level that could see it rebound to $26.

Synthetix price may recover and maintain the uptrend

Synthetix price took investors by surprise as it crashed from $24 to hit a low of $10 on May 19. The panic selling seems to have stopped as the overall structure of the cryptocurrency market looks more optimistic today, May 20.

From a technical perspective, the increase in downward pressure behind SNX price was contained by the 200-day moving average at $14.40. This is the first time since mid-December 2020 that Synthetix price tests this trend-following indicator for support. 

While the crypto market continues recovering after the recent crash, Synthetix price managed to bounce back. It recovered by nearly 70% from the $10 low and regained the 200-day moving average as support. 

Moreover, SNX continues to trade in a descending parallel channel pattern formed since February 14 after the all-time high of $30. If Synthetix price manages to hold inside this technical pattern, it could bounce towards the channel’s upper limit at $26.

To advance further, Synthetix price would have to break out of the channel and turn the $26 barrier into support. The bullish divergence between SNX price and the relative strength indicator (RSI) adds credence to the optimistic outlook.

SNX/USDt daily chart

It is worth noting that Synthetix price must continue to hold above the 200-day moving average and the channel’s lower boundary to keep the uptrend. Failing to do so may allow the bears to regain control. In that event, SNX could drop to retest $10.