Despite a massive 57.3 million ZRO transfer worth roughly $98 million into BitGo-managed institutional custody, ZRO surged more than 11% in 24 hours, reflecting strong demand absorbing the supply shock.
Price did not hesitate after the transfer. Instead, buyers responded immediately, driving continuation rather than hesitation.
Large custody movements often introduce uncertainty, yet LayerZero [ZRO] moved decisively higher. That response signals confidence rather than caution.
Moreover, follow-through buying persisted throughout the session, keeping the price elevated near the highs. Exchange-side liquidity appeared constrained, as sellers failed to force a retracement.
Derivatives participation increased alongside spot demand, reinforcing trend alignment. The market treated the transfer as strategic positioning rather than preparation for distribution.
As a result, momentum strengthened instead of fading.
This price behavior highlights an environment where larger players accumulate without disrupting structure, allowing price to expand upward while volatility remains controlled.
Double-bottom recovery sets the stage for higher prices
ZRO’s daily chart presented a well-defined double-bottom recovery that reshaped short-term direction.
Price defended the December lows near $1.20, forming a higher low that marked the end of the prior decline. Buyers entered with consistency rather than urgency, building structure instead of chasing price.
Following the rebound, LayerZero reclaimed the highlighted support zone between $1.75 and $1.80 and maintained acceptance above it. That reclaim shifted market control.
Additionally, price moved above the 50-day EMA and continued trading above it, signaling improving trend alignment.
Sellers attempted to cap advances near $2.04; however, buying pressure absorbed those efforts. As long as price remains above the reclaimed support zone, downside risk stays contained.
A sustained push through $2.04 would open the chart toward the $2.60 region.
Source: TradingView
Open Interest growth aligns with spot participation
Derivatives data supported the constructive price action. Open Interest rose more than 25% to approximately $52 million while LayerZero continued climbing.
That alignment matters because OI expanded alongside price rather than diverging from it. Traders added new positions instead of closing exposure.
Moreover, price stability persisted despite rising leverage, suggesting confidence rather than fragility. This behavior contrasts with short-covering rallies, where OI typically declines as positions unwind.
Here, leverage participation reinforced spot demand. However, rising Open Interest increases sensitivity to volatility shifts. If price stalls, leverage could unwind quickly.
Source: CoinGlass
Short liquidations dominate ZRO pushes higher
ZRO’s liquidation chart confirmed that shorts absorbed most forced exits during the rally. On the 21st of January, total short liquidations reached roughly $236,000, while long liquidations remained limited near $32,000.
Binance led the flush with about $74,800 in short liquidations versus $22,000 in longs.
Bybit followed with approximately $46,400 in shorts wiped out, while OKX recorded over $106,000 in short liquidations against just $7,700 in longs.
This imbalance showed traders positioned against the move faced sustained pressure.
Importantly, liquidations occurred in measured waves rather than a single spike. That pacing allowed the price to grind higher without exhausting momentum.
As shorts exited, selling pressure diminished. Buyers maintained control throughout the session, keeping structure intact.
Source: CoinGlass
Overhead liquidity could shape the next interaction
The Binance ZRO/USDT liquidation heatmap reveals dense liquidity clusters above the current price, concentrated between $2.00 and $2.05.
These zones often attract price as volatility builds. Buyers may attempt to push into these levels, while sellers prepare defenses.
Downside liquidity appears thinner by comparison, creating an asymmetrical setup favoring upward interaction.
However, liquidity clusters invite engagement rather than guarantee continuation. Price behavior near resistance will define the next phase.
A controlled push through the $2.05 zone could trigger additional short liquidations and accelerate movement. Conversely, rejection may lead to consolidation above reclaimed support rather than a trend reversal.
Importantly, the heatmap suggests price has room to explore higher levels before encountering meaningful downside pressure, keeping volatility biased upward in the near term.
Source: CoinGlass
Conclusively, ZRO’s advance reflects strong absorption, improving structure, and aligned leverage participation rather than a temporary squeeze.
Price reclaimed key support, pressured short positioning, and attracted fresh derivatives exposure. If buyers continue defending the $1.75–$1.80 zone, interaction near $2.04 remains likely.
Sustained acceptance above that level would keep the path toward $2.60 technically viable, while rejection would likely result in consolidation rather than structural weakness.
Final Thoughts
- Institutional absorption suggests confidence-driven positioning rather than short-term speculation.
- Market structure now favors continuation if buyers defend reclaimed support zones.