Zilliqa Price Forecast: ZIL to pause before launching 120% rally
|- Zilliqa price bounces over 100% from the May 23 low, but volume lags.
- 200-day simple moving average (SMA) has played a role of support or resistance over the previous seven days.
- ZIL daily Relative Strength Index (RSI) reached the most oversold reading since March 2020.
Zilliqa price has stalled at the May declining trend line after setting the framework for a double bottom on the daily chart. Volume has not been cooperative during the rebound, suggesting that a pullback or pause is necessary to refresh ZIL after the 100% bounce from the May 23 low.
Zilliqa price boasts clear points of support for any future weakness
Zilliqa price declined over 70% from the all-time high at $0.262 to the May 23 low at $0.069. The decline followed several failed attempts to overcome the 2018 high at $0.235, resulting in a double top pattern that triggered on May 19 with a fall below $0.115.
ZIL briefly identified support at the 40-week SMA, the March 2020 rising trend line and the 23.6% Fibonacci extension of the advance beginning in March 2020 at $0.085, before finally bottoming at $0.069.
Moving forward, the price range defined by the May declining trend line, currently at $0.140, and the 200-day SMA at $0.113 should contain Zilliqa price over the next few days and provide the base for higher prices.
A successful ZIL breakout above May’s declining trend line and the 61.8% retracement of the May correction at $0.155 would trigger the double bottom pattern and set Zilliqa price on the path to test the declining 50-day SMA at $0.183 and then the 78.6% retracement at $0.194.
As was the case in April and early May, the 2018 high at $0.235 will interrupt the rally. A daily close above the all-time high at $0.262, representing a 120% gain from price at the time of writing, would confirm the resistance has been solved, and Zilliqa price can begin a sustainable advance into new highs.
ZIL/USD daily chart
An acceleration of selling pressure below the 200-day SMA would instigate a test of the March 2020 rising trend line at $0.094. A failure to hold the trend line would push ZIL to the 23.6% retracement at $0.085.
Any further weakness would signify that Zilliqa price is entering a new phase for the correction that could push ZIL to test the 38.2% retracement of the advance beginning in March 2020 at $0.042.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.