ZIL Breaks Out After Bouncing at Long-Term Support

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In Brief
  • ZIL has bounced at the long-term $0.056 horizontal support area.

  • It has broken out from a descending wedge.

  • ZIL/BTC is still trading inside a descending wedge.

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Zilliqa (ZIL) has been moving downwards since attaining an all-time high in May but has bounced after reaching a long-term support area.

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The bounce led to a breakout from a descending wedge. ZIL is now aiming to move towards the two closest resistance areas at $0.09 and $0.115.

ZIL reaches long-term support

ZIL has been moving downwards since May 6, when it reached an all-time high price of $0.256. The downward movement continued until a low of $0.05 was reached on July 20. 

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The low was made inside the 0.786 Fib retracement support area at $0.056. 

While ZIL has bounced slightly since the low, technical indicators are still bearish. The RSI is below 50, the Stochastic oscillator has made a bearish cross, and the MACD is nearly negative.

Chart By TradingView

Wedge breakout

The shorter-term six-hour chart shows that ZIL had been trading inside a descending wedge since May 23. After consolidating inside the wedge until the aforementioned July 20 low, it broke out on July 22. 

The MACD & RSI are both increasing, supporting the continuation of the upward movement. The closest resistance levels are at $0.09 and $0.115. These are the 0.382 and 0.618 Fib retracement resistance levels when measuring the entire length of the wedge.

Chart By TradingView

Wave count

Cryptocurrency trader @CryptoTony_ outlined a ZIL chart, stating that the token has begun a new bullish impulse.

Source: Twitter

In the short-term, the upward movement does look like the beginning of a new bullish impulse.

In this possibility, ZIL has just completed wave one (black) and is correcting in what is likely to be wave two.

The entire impulse could take the token towards the $0.09 and potentially $0.0115 resistance levels. The $0.09 resistance area also coincides with the 3.61 Fib extension of wave one.

Chart By TradingView

ZIL/BTC

The ZIL/BTC chart looks decisively bullish. The token has been trading inside a descending wedge since May 6. It is nearing the end of the pattern, therefore a decisive movement is expected. 

There is a bullish divergence in both the MACD & Stochastic oscillator. In addition, the RSI has moved above the 20 line. 

If a breakout occurs, the closest resistance area would be at 277 satoshis.

Chart By TradingView

For BeInCrypto’s latest bitcoin (BTC) analysis, click here.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
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Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona graduate school of Economics. Shortly after graduating, he began writing for several different cryptocurrency related websites as a freelancer before eventually taking on the role of BeInCrypto's Senior Analyst.

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