Zilliqa [ZIL] registers gains of 45%, but shorting opportunity could arise at…

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice.

Why exactly did Bitcoin climb past $39k again? A capitulation beneath $37k was expected, but instead, the charts showed that the blood bath was cut short rather than being extended. Zilliqa was one of the coins that surged hard in the past couple of days.

ZIL – 1 Hour Chart

Source: ZIL/USDT on TradingView

As the month of April drew to a close, the price action of ZIL was strongly bearish. A series of lower highs and lows were registered on the chart, characteristic of a downtrend. As May began, ZIL appeared to consolidate in the $0.068-$0.072 area.

Based on the Volume Profile Visible Range, the Point of Contol lies at $0.0712, and the Value Area Highs at $0.0926. These are two areas where trading volume has been heavy in the visible time range on the chart, and they can be expected to act as strong support and resistance levels.

Rationale

Source: ZIL/USDT on TradingView

The RSI soared nearly as high as 90 as ZIL rocketed higher in the past two days. At press time, it was falling back toward the neutral 50 line, while the Stochastic RSI was also in the oversold territory. Zilliqa can be bought near the $0.086 support if a hidden bullish divergence between price and RSI (lower low on the RSI, higher low on the price chart) develops.

The OBV saw a sharp spike upward in response to heavy buying volume and provided evidence for a rally backed by genuine demand.

Conclusion

The market structure has been decisively flipped to bullish on lower timeframes, and the $0.086 level of support could be used to enter long positions. A session close below $0.09 for Zilliqa will likely see the coin drop further, toward $0.085, and since the bulls are in the driving seat, it would be a good idea to trade with the bullish trend.