Tezos Breaks the Trendline but Takes Support From 200 DMA
Tezos still ranks around 41st position even after its fall of close to 37% to the current price of $5.575. This price trend carries a $5 billion valuation indicating its strength in fundamental aspects. But prices in crypto are mostly devoid of such a financial term. XTZ is not just limited to the smart contract supporting ecosystem. Still, it focuses on developing one that can work and evolve with the pace of time without facing the flak of hard fork as witnessed on the Ethereum network.
The incorporating of evolving features will ensure that XTZ will remain to test the tide of time. The offering and ideation involving a governance process besides a blockchain adding the power of voted decentralizing is unique. A decentralized ecosystem can be evolved by nods of centralized players, much like a stock in a financial index.
To participate in the network’s governance process, called baking, one needs to stake 8000 XTZ. The method of baking further involves a four-step procedure that can take up to 23 days to complete. Finally, after a proposal is accepted, it is kept for a test net for 48 hours before being implemented on the entire network.
Tezos Price Analysis
After multiple breakout attempts, Tezos successfully breached its more extended resistance zone but underwent a significant profit booking since hitting a fresh high in October 2021. However, the profit booking seems to have died down along with the transaction volumes. Without the return of higher volumes, prices will nosedive, breaking the support of $5.50 in the near term.
As visible, the trend which started in mid-July reached its conclusion in October, but unlike previous swings, this profit booking has broken the critical trend line. Taking consistent support from the trend line ensured that prices would be retesting the upper limit. But since breaking the trend line, this outlook has shifted towards whether Tezos will be able to take support from the $5.50 levels.
Although there are minor signs of a possible pullback from this support level, there is a higher probability of a breakdown. Breaching this support level will take Tezos back to the initial breakout levels only if the 200 DMA support curve of $4.76 fails to support the falling value. XTZ has had a huge run, taking multiple supports from this level so far. In such a momentum, witnessing the action near 200 DMA will be essential to predict the further possible price actions.
XTZ has shown a significant decline in trading volumes along with a dip in the buying sentiment. According to Tezos price prediction, the outlook is negative for the near term, and any hopes of retracements depend on how the price reacts to the support levels.