• Chiliz price near breakout from a flag continuation pattern.
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Chiliz price steadily declined in a flag pattern for weeks, but it closed last week with a hammer candlestick. The successful shakeout below the flag’s lower trend line combined with the test of the 61.8% retracement of the February-March rally has positioned CHZ in a timely position for purchase in the coming days.

Chiliz price action shows that bulls are now in control 

A steep, sharp price trend precedes flag patterns, and in the case of CHZ, the February-March trend rallied over 3000%. Flags that are preceded by a rally of at least 90% have almost a zero failure rate and an average return of 69%. The best flags are less than 15 days, and volume declines throughout the pattern formation

CHZ closes last week with a hammer candlestick that successfully tested the low of the flag and the 61.8% retracement level before engineering a rebound to close with a real candle body no larger than a third of the hammer pattern range. 

The hammer pattern provides speculators with a clear trigger price at the hammer high of $0.541. The first area of resistance for the new rally is the 50% retracement of the March-April correction at $0.670, followed by the 61.8% Fibonacci retracement at $0.742.

A rally of 69% targets $0.914. If volume accompanies the rally, CHZ should not have any problem testing the March high at $0.976.

CHZ/USD weekly chart

CHZ/USD weekly chart

A breakdown below the hammer will be met quickly with support at the 10-week simple moving average at $0.346. If selling accelerates, speculators need to mark the 78.6% retracement of the February-March rally at $0.233.

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.

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