As the price of Bitcoin (BTC) has been consolidating in a range, altcoins have been moving left and right. A few have managed massive triple digit rallies and others like Zilliqa (ZIL) have rallied 1,400% since March 12.
VeChain (VET) has been another strong performer and to date the altcoin has rallied 650% since bottoming in March and another 150% in the past thirty days. After such strong moves it natural to see some exhaustion amongst buyers but let’s dive into the charts to see what each looks like.
Crypto market daily performance. Source: Coin360
VeChain breaks massive barrier after 18 months
The VET/USDT chart shows the pair has broken through the resistance at $0.008-0.0087. This resistance has been acting as resistance for more than 18 months and has been tested many times.
VET/USDT 1-day chart. Source: TradingView
VET also broke through the 100 and 200-day moving averages which is a significant indicator of bull and bear markets. As the price is acting above the moving average, a conclusion can be drawn that the market is performing in bull territory.
The second interesting fact is the increased volume since November 2019. Such an increase often leads to the accumulation and shows an increased interest in the asset.
Finally, the resistance zone at $0.008-$0.0087 has been tested seven times already. This level has been providing massive resistance throughout the past 18 months. After multiple attempts VET managed to breakthrough through and continuation to the upside is expected.
It is essential that the previous resistance between $0.008-$0.0087 holds in order for upwards continuation to occur. As long as this range holds for support the next resistance zones could get tested shortly at $0.012 and $0.0145.
VET/BTC still faces a significant resistance
The VET/BTC pair is facing significant resistance as the daily chart is showing.
VET/BTC 1-day chart. Source: TradingView
The 0.00000100-0.00000105 sats resistance zone has been a tough resistance to crack. However, once the resistance breaks, a continuation of 0.00000150 is likely. It’s important to remember that VET has witnessed a substantial 140% rally in a short period and this usually ends with a consolidation period before continuing the upwards expansion.
In this case, the previous resistance zone at 0.00000078-0.00000081 sats could provide a test for support, and this defines a range-bound period. During a range-bound period the volume dries up and the price starts to become less volatile, through which a breakout below 0.00000080 sats or above 0.00000105 sats could lead to a high volume move.
Traders should watch to see if VET goes to 0.00000080 sats. If the level provides support, a potential new trade can be placed as a retest of the 0.00000105 sats level can occur.
After several tests, a breakout of this resistance zone could occur and this might lead to a rally towards 0.00000150. However, losing the 0.00000080 sats zone would imply a downwards continuation towards 0.00000060 sats.
Zilliqa shows strength after one-year accumulation
ZIL/BTC 1-day chart. Source: TradingView
After trading in a sideways accumulation range for almost a year Zilliqa is showing strength by breaking from this range to rally 435%. After such an expansion, it’s likely to see a consolidation period, as the asset needs to generate fuel for a new impulse wave to the upside. As shown above, ZIL is encountering a significant resistance zone at 0.00000290-0.00000330 sats.
However, is the uptrend over? No, the chart is simply showing that Zilliqa is currently facing an essential support area. If that remains support, further upwards momentum can be expected, along with a renewed test of the upper resistance area.
The support zone between 0.00000210-0.00000230 sats is the area to watch and as long as that remains valid, the uptrend is intact.
However, once Zilliqa drops below this vital support zone, a more extensive correction is expected. This is not terrible as it is typical for a cryptocurrency to retrace 40-50 percent after a strong expansion. Other cryptocurrencies have been showing these substantial corrections as well, after which further extension to the upside occurs.
If the support area is lost, a potential drop towards the 0.00000120-0.00000140 sats area is on the tables. This support zone could grant a great buy the dip opportunity, as long as it holds.
Areas to watch on the ZIL/USD pair
ZIL/USD 1-day chart. Source: TradingView
The ZIL/USD pair rejected at the resistance area between $0.025-$0.03 but this is not necessarily a bad thing since ZIL has rallied 1,400% since March.
The primary support zone to look for is the green area between $0.013-$0.016 and this zone can be stated as the range low.
As long as this area remains support, the ZIL/USD remain above the 100 and 200-Day moving averages which can be considered bull territory.
After such a significant impulse move, a correction can take weeks or several months. If the correction is over and the next impulse move starts, it’s not unreasonable to expect another 300-500 percent move towards $0.05-$0.06 or even higher.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Joseph Spezzano received a Masters Degree in computer science from The University of Massachusetts. Joseph has been working as a full-time blockchain programmer for the past 5 years. In his spare time, Joseph enjoys writing for CryptocurrencyInvestments.com and traveling.