Zilliqa price is currently located below the 200-day simple moving average (SMA) and on the ascending trendline from March 2020 low. The short-term outlook has naturally shifted from slightly bullish to bearish with May lows as potential targets should the trendline fail to stave off increased selling pressure.
Zilliqa price falls under the weight of an anxious crypto market
To examine, Zilliqa price is down more than 70% from an all-time high of $0.262 to a May 23 low of $0.069. The remarkable drop came after multiple attempts to break the 2018 high of $0.235 and resulted in a loudly triggered double top on May 19 with a drop below $0.115.
Zilliqa price struggled to identify support around the 40-week SMA, the March 2020 ascending trendline, and the 23.60% retracement of the March 2020-May 2021 advance before dropping to $0.069. ZIL followed May 23 with a 100% rally to the high of May 27, but then fell again until it recovered from May 30 to June 3. In the process, the digital asset emerged from a symmetrical triangle supported by a burst of volume.
The breakout from the symmetrical triangle has since reversed and pushed Zilliqa price below the 200-day SMA to the May 2020 ascending trendline at $0.101. ZIL defends the trendline, but a daily close below the trendline and more importantly, below the May 30 low of $0.092 will increase the risk of a new bottom correction going forward.
The measure move target of the symmetrical triangle is $0.054, which represents a drop of just over 54% from the lower trendline of the triangle on the day of the breakout.
ZIL/USD daily chart
A daily close above the double top trigger of $0.115 could turn the outlook from bearish to neutral.
The weekly ZIL chart highlights the importance of the support framed by the March 2020 ascending trendline at $0.101 and the 40-week SMA at $0.091. Further, the chart shows an air gap below the May 23 low until the 38.2% retracement of the 2020-2021 rise.
ZIL/USD weekly chart
With scalability challenges engulfing the blockchain community, the ZIL blockchain project is becoming a vital solution to accelerate the number of transactions that can be processed per second. The underlying momentum has the potential to support Zilliqa price seeking for all-time highs. Still, the current technical state of the cryptocurrency is volatile and offers little leverage to start a new uptrend.