Tezos price struggles to advance further as it faces stiff resistance
|- Tezos price has shaped a high handle on the weekly chart.
- The $3.50 support needs to hold on a weekly closing basis.
- The topside trendline and extension levels loom large for a renewed rally.
On March 12, blockchain form Madfish Solutions announced that the Tezos network was on pace to destroy the record of 100,000 monthly contract calls set in February. It is a notable milestone for their ecosystem development, but XTZ price has not reacted.
Tezos price needs a significant catalyst
The correction from the February high at $5.70 discovered support at the confluence of the 10-week simple moving average (SMA) and the $3.50-$3.60 price range. It is a positive development after rallying 250% from the December 2020 low. Another positive development is the declining volume as price has pulled back—a characteristic of a constructive handle.
Regardless, there is major resistance in the path to a new high. Firstly, there is the 1.382 extension level of the February - March 2020 meltdown at $5. Secondly, there is the topside trendline that currently runs through $5.30, and lastly, there is the 1.382 extension level of the August - December 2020 decline at $5.60.
The $5-$5.60 price range will determine the fate of the bull’s call for Tezos to reach new highs.
XTZ/USD weekly chart
XTZ is not at a make-or-break moment on the weekly chart, but it has only given a small sample of bullish signals to justify a forecast for new highs.
If the price closes below $3.40, it would be a blow to the bulls, and more importantly, it would raise the odds that the digital asset will at least test the .618 retracement level of the December - February advance.
A failure to hold that level on a weekly closing basis means that Tezos price is ready to crumble down to the .786 retracement level at $2.50, at least.
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