Zilliqa (ZIL) in Consolidation: Will It Give Good Returns?

Zilliqa is the first cryptocurrency that implemented sharding in the blockchain. It allows linear scaling as the chain grows over time. Indeed, it is an issue for almost all cryptocurrencies. Even Bitcoin cannot process all the demands of its network. The same case is with ETH; smart contracts have become gas-intensive.

For Zilliqa, the best part is, there is no limit to the number of transactions. It has changed how a blockchain reaches a consensus. The sharding solution increases with the size of the network. However, it still depends on the number of nodes. In addition, it can also handle thousands of transactions per second.

It even supports smart contracts. The new model applies a hybrid consensus protocol to grow the network. One million nodes are the upper limit of Zilliqa. In reality, it is nowhere closer to its limit because it has only 2800 nodes (approx), whereas Bitcoin has approximately 11 thousand nodes.

Let’s analyze and get more details on the price chart of Zilliqa.

At the time of writing the post, Zilliqa is $0.059. It is standing on its support level and has been consolidating for the last seven months. It has been maintaining a resistance level of $0.12 and a support level of $0.06. Is it the right time to invest?

Let’s analyze the technical tools and find out what they are indicating!

MACD is making a bullish crossover on the daily chart, but it is still not considered the ideal time to invest. RSI is weak at 35, and it is in an oversold zone. Recent candlesticks are forming in the lower Bollinger Band, which is a bearish signal. Moving Average is also following the bearish trend.

As it is consolidating in a range, it is not the right time to invest for the long term. However, it gives a good opportunity for swing trading.

If you have strong faith and understand the fundamentals of this cryptocurrency, then you can invest for the short term because $0.059 is a strong support zone in this chart. Six months will be a reasonable holding period for this coin, and it might provide good returns next year.

All the world’s major indices are down; the cryptocurrency world is also affected by various reasons like inflation, new covid variants, and other regulations.

Many people who invested in cryptocurrency now want to invest in Government bonds because it offers more security.

You should wait for a breakout before investing in this cryptocurrency because you do not know when the consolidation will end. For long-term investment, you should choose other options or safer returns!