LayerZero (ZRO) is facing a crucial moment as its attempts at recovery stumble under increasing bearish pressure. Initially, the altcoin showed promise, but its upward momentum has now stalled, signaling potential downturn risks. Key support levels are under threat as bearish forces gain strength, casting doubt over LayerZero’s recovery prospects.
Recent market analysis highlights several challenges for LayerZero. The price recently took a bearish turn on the 4-hour chart, falling below the critical 100-day Simple Moving Average (SMA) after multiple unsuccessful attempts to cross it. This failure to maintain upward motion indicates a shift in market sentiment toward selling pressure overshadowing buying interest.
Further analysis of the 4-hour Relative Strength Index (RSI) reveals a declining trend, with the signal line dropping to 44% from a previous high of 47%. This suggests that the asset is nearing oversold territory, raising alarms about further potential declines. Additionally, the daily chart for LayerZero points to negative momentum, highlighted by several bearish candlesticks and a dip below the 100-day SMA. The presence of multiple pessimistic candlesticks and the breach of the SMA underline a strengthening negative sentiment as sellers intensify their downward push.
The situation on the 1-day chart is also concerning; the RSI has dropped below the crucial 50% threshold, currently at 44%. This reading indicates that sellers are increasingly dominant, which could push the asset closer to oversold territory and elevate worries about more price drops.
Given the current market conditions, LayerZero’s price seems set to dip further toward the $3.5 support level. Should it fall past this critical point, the cryptocurrency could experience an extended downward trajectory, testing other significant support benchmarks.
However, there remains a glimmer of hope. If LayerZero’s price stabilizes and regains bullish momentum, it might ascend toward the $4.5 resistance level. Successfully breaching this mark could pave the way for further gains, as market sentiment might shift back in favor of bullish trends, potentially targeting even higher resistance levels. Currently trading at $3.8, LayerZero stands at a precarious crossroads, with its future trajectory hinging on the interplay of selling pressure and any resurgence in buying interest.