LayerZero (ZRO) extended its bullish momentum soon after breaking out of a pennant consolidation pattern on 19th August. In the days after, the rally pushed beyond the pattern’s pole high at $1.30.
On 23rd August though, the altcoin’s resistance level initiated a market reversal. A similar reversal followed on 26th August, despite ZRO’s recent gains on the price charts. These gains, over the weekly timeframe, amounted to 35%.
ZRO’s price action has been supported by improving spot demand and strong whale activity in Futures markets. Additionally, at press time, ZRO was trading above its 20-day, 50-day and 100-day EMAs. This suggested that both short-term and medium-term momentum were firmly bullish.
With ZRO trading above its key daily EMAs, the $1.40 resistance now stands as the next major target. Could the rally proceed to test the key level?
Network whales are also making moves
At the time of writing, the network’s derivatives metrics were flashing bullish signals too. Large whale orders have dominated ZRO’s Futures market, suggesting that larger participants may be actively positioning around the token’s press time price.
If these positions continue to support the bullish trend, they could provide additional momentum towards the next resistance level.
At the same time, the Spot Taker CVD hinted at increasing buyer dominance, indicating that spot demand may be strengthening across the board too.
Together, such a combination creates a supportive backdrop for a rally on the charts.
What about the trading volume and the FDV?
Now, the altcoin’s technical indicators hinted at a potential rally while its derivative data alluded to real-time participation among token holders and buyers. However, is volume required to avail the required volatility for encountering the selling pressure from the profit -taking phase present?
ZRO’s elevated trading volume and FDV may provide us the answer. LayerZero’s trading volume exceeded its fully diluted valuation over the past week, highlighting an unusually high market turnover relative to the altcoin’s potential fully diluted value.
In facts, its trading volume pushed past the $1.4 billion-mark over the past two days.
Can ZRO hit $1.40?
ZRO’s 35% weekly surge, pennant breakout, and strong positioning across Spot and Futures markets have so far kept the bullish setup intact.
Considering that the price was above the 20-day, 50-day, and 100-day EMAs, bulls can take technical advantage of a continuation move. $1.40 stands out as the next test for ZRO.
A continuation of the buyers’ dominance in the spot market and support by whales in the Futures market can result in a rally to $1.40. However, any breakdown below the key EMAs will invalidate the setup.
Final Summary
- ZRO gained by 35% in a week after breaking above its pennant and the $1.30 pole high.
- Whale activity and spot buying strengthened across the board, with ZRO trading above its key EMAs too.
