Zilliqa (ZIL) is trading at $0.0058 on Wednesday after adding more than 4% to its value since Tuesday. The coin is currently rallying thanks to growing retail demand fueled by rising trading volume and Open Interest (OI).
With the funding rates also positive and the momentum indicators switching bullish, ZIL could rally towards the $0.0065 mark for the first time since December.
On-chain data paints a bullish picture for Zilliqa
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ZIL has added 13% to its value in the last two days, outperforming the major cryptocurrencies, including Bitcoin, Ether, and XRP.
Data obtained from Santiment shows that ZILs ecosystem trading volume hit $92.59 million on Monday, the highest level since July 4, and steadied at around $27.46 million on Wednesday.
The surge in trading volume suggests that traders are regaining interest in Zilliqa, adding more liquidity to the market and boosting its bullish outlook.
Furthermore, derivatives data support a bullish outlook for ZIL. CoinGlasss data reveals that ZIL futures OI across exchanges reached $13.48 million on Tuesday, the highest level since October 11.
With the OI on the rise, additional money is entering the ZIL ecosystem, with more traders taking long positions over shorts in the market.
ZIL‘s OI-Weighted Funding Rate also reveals that traders betting on ZIL’s price declining are lower than those expecting it to rally higher.
The OI flipped to a positive rate, standing at 0.0059% on Wednesday, indicating that longs are paying shorts.
When this happens, ZILs price has rallied in the near term.
ZIL bulls target the $0.0065 resistance level
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The ZIL/USDT 4-hour chart has switched bullish since adding 13% to its value in the last two days.
The rally allowed it to close above the 50-day Exponential Moving Average (EMA) at $0.0055 and briefly hit the $0.0062 resistance level.
ZIL encountered resistance around the $0.0062 and has slightly retraced to now trade at $0.0058 per coin.
If the daily candle closes above the $0.0058 level, ZIL could overcome the wick at $0.0062 and rally towards $0.0065 for the first time in nearly two months.
An extended rally could see ZIL hit the $0.00682 psychological level.
The Relative Strength Index (RSI) on the 4-hour chart is 57, above the neutral level of 50, indicating bullish momentum is gaining traction.
Moreover, the Moving Average Convergence Divergence (MACD) shows a bullish crossover that remains intact, adding further confluence for the buyers.
However, if ZIL fails to close the daily candle above $0.0058, the correction could extend towards the 50-day EMA at $0.0055.
The Sunday low of $0.00510 could also be revisited if the bearish trend extends further.
Currently, the market conditions are bullish, and this could see ZILs price rally higher in the near term.