During a bull market, negative news is quickly digested and collateral damage is often limited. Therefore even if XRP price dumped Aggressive due to uncertainty over the outcome of the US Securities and Exchange Commission lawsuit, other altcoins have remained largely untouched.
Additionally, like Bitcoin’s (BTCStrong rally is taking a breather, several altcoins have broken out of their overhead resistance levels trying to resume their uptrend. Let’s take a look at a few tokens that have risen sharply in recent days and analyze their charts to see if the rally could stretch further.
ZIL / USD
Zilliqa (ZIL) rose sharply in 2020. Part of the rally could be attributed to the decentralized financial boom that dominated much of the year.
After launchDue to its decentralized exchange ZilSwap on October 5 and non-custodial strike on October 14, the token rose significantly. These new features allowed the community to participate directly in the smart contract, whereas previously they had to do so through an external intermediary.
To date, the community has been committed 30.49% of the total outstanding offering and the low eligibility threshold of 10 ZIL may have attracted greater participation from token holders.
During the coronavirus pandemic, most people stayed indoors and spent their time on social media. So the timing of Zilliqa’s SocialPay launch couldn’t have been better. The platform launched in May and it rewards users for sharing Zilliqa’s updates and announcements on Twitter.
All these fundamental developments could be the reason for the increase in wallet addresses and monthly transactions in 2020. But can the token continue its outperformance in 2021? Let’s study the charts to find out.
The altcoin has experienced a strong upward trend, rising from an intraday low of $ 0.0296388 on December 12 to an intraday high of $ 0.0996 on December 27, up 236% in about two weeks. Usually these vertical rallies are not sustainable in the long run. Periodic corrections or consolidations are needed that can cool down the upward movement and extend the life of the trend.
The ZIL / USD pair has formed consecutive Inside Day candlestick patterns on December 28 and today. This suggests a contraction in volatility when the bulls and bears decide the next direction move.
If the inside day goes up, the uptrend can resume. Conversely, if the internal day candle is followed by a sharp downward move, the bears may have gotten the upper hand and a deeper correction would be expected.
Therefore, if the Bears drop the price below the 38.2% Fibonacci retracement level at $ 0.0728748, it will drop to the 50% retracement level at $ 0.0646194 and then to the 20-day exponential moving average ($ 0.0570) possible.
A strong setback from this support was that positive sentiment remains intact as traders pile on dips. The bulls will then attempt to resume the uptrend and if they can push the price above USD 0.0996, a rally towards USD 0.14 may be possible.
On the other hand, if the price falls below the 20-day EMA, it would suggest that there could be a short term top as bulls are reluctant to buy on dips.
LUNA / USD
Terra Protocol’s LUNA appears to have benefited through increased acceptance of its existing products and the proposed launch of new ones. The Chai payment app witnessed more than 2.8 million transactions with payment volumes in excess of $ 90 million in November.
To capitalize on strong demand for US stocks, commodities and ETFs, Terra launched the Mirror Protocol on December 4, which enables the creation and trading of synthetic assets. This could continue to attract traders as long as the assets remain in a strong trend.
Terra is also trying to address the product referral marketing category that primarily benefits the direct referrer. The protocol is going to be official launch BuzLink, a February 2021 marketing tool that will reward the entire referral chain after the sale is complete.
LUNA is up from an intraday low of $ 0.45 on December 24 to an intraday high of $ 0.70 today, gaining 55% within a week. The rising moving averages and the relative strength index (RSI) close to the overbought zone suggest that bulls have the upper hand.
The LUNA / USD pair broke above $ 0.57 overhead resistance on Dec. 28, completing a rounding pattern. This bullish setup has a targeted target of $ 0.86.
However, the long wick Doji candlestick pattern shows today that traders are making profits at higher levels. This could bring the price down towards the USD 0.57 breakout level.
If the pair bounces back from this level or even the 20-day EMA ($ 0.51), it will suggest that the bulls are in control. A break above $ 0.70 could resume the uptrend.
Contrary to this assumption, if the bears are sinking and keep the price below $ 0.57 and the 20-day EMA, it will suggest that the recent breakout was a bull trap. The trend may be in favor of the bears if the pair falls below USD 0.45.
FAT / USD
The coronavirus pandemic has made people and businesses even more aware of the power of digital technology. VeChain (VETERINARIAN) developed the E-HCert app in partnership with the Mediterranean Hospital of Cyprus to store COVID-19 test records. After the successful implementation, Aretaeio Hospital has also joined the VeChain ecosystem to integrate its laboratory testing services, making the data easily accessible for patients to use as required.
The VeChainThor blockchain also recently received a 5-star Blockchain service certificate from TÜV Saarland, a European certification body. This could increase confidence in its ecosystem and also improve investor sentiment about VET token. In a further boost, Grant Thornton Cyprus revealed itself as one of the VeChainThor Authority Masternodes. These developments can open new possibilities for the future.
FAT is up from an intraday low of $ 0.011724 on Dec. 23 to an intraday high of $ 0.02120375 today, up 80% in a short space of time. The Bears are likely to aggressively defend the USD 0.02210 level as it has served as a stiff resistance in recent months.
However, if the VET / USD pair does not break below USD 0.018, the bulls will make another attempt to drive the price above USD 0.02210. If successful, the pair will complete a rounding bottom pattern with a target of $ 0.0353.
The 20-day EMA ($ 0.0165) is starting to appear and the RSI is above 60, suggesting bulls are predominant. Even a consolidation between $ 0.018 and $ 0.0221 will be a positive sign and it will increase the likelihood of an overhead resistance breach.
Contrary to this assumption, if the price is declined again at $ 0.02210, this could attract profit bookings from the short term traders and that could pull the price back below the moving averages. Such a move could indicate that the pair could consolidate into a wide range for a few days.
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