Zilliqa Price Analysis: ZIL risks deeper correction as bearish pressure mounts

Zilliqa price is retesting a previously broken trendline, with rejection likely to trigger a deeper correction.
Derivatives market shows a bearish bias, with Open Interest on Binance falling to its lowest level since mid-December.
The technical outlook suggests a downward move, with momentum indicators signaling bearish bias.

Manish Chhetri FXStreet

Zilliqa (ZIL) is nearing key resistance, trading at $0.0050 on Wednesday; a rejection could trigger a deeper correction. The weakening derivatives positioning among traders further supports the bearish price action in ZIL. In addition, the technical outlook suggests further correction as momentum indicators turn negative.

Zilliqa’s waning investor participation

Zilliqa derivatives show signs of weakness, with futures Open Interest (OI) on the Binance exchange dropping to $2.25 million on Wednesday, levels not seen since mid-December, reflecting waning investor participation.

Zilliqa open interest chart at Binance exchange. Source: Coinglass

Zilliqa Price Analysis: ZIL bears are in control of the momentum

Zilliqa price closed below the ascending trendline (drawn by connecting multiple lows since December 19) on Tuesday, indicating a shift in market structure. As of Wednesday, ZIL is nearly at this breakout zone, which roughly coincides with daily resistance at $0.0051 and the 50% price level (drawn from the December low of $0.0042 to the January 12 high at $0.0061) at $0.0052, making this a key reversal zone.

If ZIL faces rejection from these resistance levels, it could extend the decline toward the December 31 low of $0.0046.

The Relative Strength Index (RSI) on the daily chart reads 45, below the neutral level of 50, indicating bearish momentum is gaining traction. The Moving Average Convergence Divergence (MACD) also showed a bearish crossover on Tuesday, further supporting the negative outlook.

However, if ZIL recovers and closes above the daily resistance at $0.0051 on a daily basis, it could extend the advance toward the 50-day Exponential Moving Average (EMA) at $0.0054.

Author

Manish Chhetri

FXStreet

Manish Chhetri is a crypto specialist with over four years of experience in the cryptocurrency industry.

BNB Price Forecast: BNB loses strength as crypto market drops

BNB (formerly Binance Coin) loses ground as the broader cryptocurrency market falls, recording a 1% drop at the time of writing on Wednesday. Retail interest in the exchange token is declining, as evidenced by the massive wipeout of long positions and a decline in futures Open Interest.