Zilliqa has experienced a 3.23% drop over the past 24 hours of trading. The cryptocurrency is currently being traded around $0.0368, at the time of writing, after experiencing a 7 day price hike totalling +10.77%.
Zilliqa, founded by Xinshu Dong, is commonly described as a scaling solution to blockchain and provides a high throughput platform that increases its throughput as it expands. This is a well sought after solution as blockchains today are currently limited by the number of transactions per second (TPS) that they can process. For a rough guidance, the top 2 cryptocurrencies, Bitcoin & Ethereum, can currently process only 7 TPS and 21 TPS respectively.
The project aims to solve this issue with scalability through a process known as Sharding. Sharding is a process where the network is divided into smaller groups known as ‘Shards’ which can process transactions in a parallel manner. This give thes project the feature of linear scaling which allows the network to continuously expand as it grows. These features allows the network to be able to process a high number of transactions without the risk of bottlenecking.
Zilliqa has been able to clock in, on its testnet, a total of 2488 TPS with a total of 3000 nodes. The 7 month old project is currently ranked at 33rd position in terms of overall market cap across the entire industry. It currently has a total market cap value of $278 million. The cryptocurrency has recently experienced a 49% drop in price over the past 30 trading days and has significant losses to regain.
ZIL/USD – LONG TERM – DAILY CHART
Analysing price action from the long term we can see that the market had experienced a significant bullish run during April 2018 as price action started from a low of $0.0351 on the 6th of April 2018 and extended to an all time high of $0.2355 on the 10th of May 2018. This was a price increase totalling over 570% from low to high.
We can see that after placing this all time high, price action rolled over and began to retrace. The market retraced all the way to the .886 Fibonacci Retracement Level priced at $0.0579 during June 2018. This is a Fibonacci Retracement measured from the entire bullish run outlined above. This Fibonacci Retracement was expected to provide significant support to hold the market, however, the bearish price action throughout August proved to be too strong as the market plummet below the support level and continued below the initial starting point of the previous bull run.
We can see that price action is currently trading at a downside 1.414 Fibonacci Extension level priced at $0.0376. This Fibonacci Extension is measured from the entire bearish swing leg see during May 2018.
Let us continue and analyse price action a little closer to highlight some potential support and resistance levels.
ZIL/USD – SHORT TERM – DAILY CHART
Analysing the market from the short term perspective, we can see that the August cryptocurrency bloodbath has not eluded Zilliqa as the cryptocurrency drops by over 64% from the opening price of the month.
We can see that the recent price drop has found support at a short term downside Fibonacci Retracement priced at $0.0266. This level provided significant support to allow the market to rebound by over 65% (from support level to high).
We can see that price action has recently been trading within a range bound between the downside short term 1.414 & 1.272 Fibonacci Extension levels priced at $0.0348 & $0.0404 respectively.
If the market breaks up above the upper boundary of the range we expect immediate resistance to be located at the bearish .382 Fibonacci Retracement priced at $0.0440 followed by the .5 Fibonacci Retracement level priced at $0.05. Further significant resistance above this level is expected at the $0.057 level which contains a confluence of the long term .886 Fibonacci Retracement level (drawn in black) and the current bearish .618 Fibonacci Retracement level.
Alternatively, if the bears manage to push price action below the lower boundary of the range we expect immediate support to be located at the downside 1.618 Fibonacci Extension level priced at $0.0266. Further support below this level is expected at the psychological round number handles of $0.025 and $0.02.
The RSI is currently still favouring the bearish sentiment as it trades slightly below the 50 handle, however, the recent rise of the RSI to the 50 handle indicates that the bears dominance has started to fade. If the RSI can make a sustained break above the 50 handle we can expect the market to make further gains.
Let us continue to quickly analyse price action for Zilliqa Against BTC.
ZIL/BTC – LONG TERM – DAILY CHART
Analysing the market from the long term perspective, we can see that Zilliqa has experienced a bullish run against Bitcoin during April 2018 as price action started from a low of 541 SATS on the 6th of April 2018 and extended to an all time high of 2508 SATS on the 10th of May 2018.
We can see that after placing this ATH price action rolled over and began to decline. It had originally found support at the .5 Fibonacci Retracement level priced at 1488 SATS. This Fibonacci Retracement is priced from the entire bullish run outlined above.
We can see that price action continued to decline throughout June and July. The bloodbath experienced throughout the entire market in August caused ZIL to continue to fall and complete a 100% retracement of the entire bullish run aforementioned.
Price action is currently trading at resistance marked by the previous long term .886 Fibonacci Retracement level priced at 633 SATS. If price action can break above this level we expect immediate support to be located at the .786 Fibonacci Retracement level priced at 844 SATS. This resistance will be significantly bolstered by the falling 100 day moving average which is currently hovering slightly above the 800 SATS handle.
Alternatively, any bearish pressure is expected to be supported by the previous long term support seen recently priced at 388 SATS.