The U.S. Central Bank Likely to Further Raise Interest Rates

Zilliqa is a blockchain platform designed to enhance scalability through sharding by incentivizing a distributed network of computers to operate the system. Its architecture is entirely sharded, and it offers typical cryptocurrency network features like smart contracts, transaction processing, and token creation. Developers can utilize its proprietary language, Scilla, to create custom programming logic (smart contracts) and develop decentralized applications (dApps) offering a variety of services.

Zilliqa launched in June 2017, founded by Amrit Kumar and Xinshu Don. Unlike Bitcoin, Zilliqa operates much faster, and its native cryptocurrency, ZIL, plays a key role in maintaining and running the network. By staking ZIL, users can also vote on network upgrades.

Since August 15, Zilliqa (ZIL) has dropped over 20%, and there remains a risk of further declines. Federal Reserve Bank of St. Louis President James Bullard recently indicated openness to a substantial interest rate hike in September, which negatively impacted stocks and cryptocurrencies.

James Bullard has mentioned he might “lean toward” a 75-basis-point rate hike at the next Federal Open Market Committee meeting, while Richmond Federal Reserve President Thomas Barkin stated that officials still have plenty of time to decide on the magnitude of the interest rate increase in their upcoming policy meeting in September.

Since March, the Federal Reserve has raised its key interest rate by 225 basis points, with the goal of curbing inflation. However, this has caused concern that such an aggressive stance could lead to a recession. Risk assets like ZIL are often negatively impacted by these measures, and with the Fed’s tightening monetary policies, ZIL’s price could decline further around the Fed meeting in September.

Technical Outlook for Zilliqa (ZIL)

After reaching highs above $0.049 on August 15, Zilliqa (ZIL) has suffered losses exceeding 20%. The price has since stabilized above $0.037, but if it drops below $0.035, it could test the support at $0.030.

On the chart (from October 2021 onward), I have highlighted key support and resistance levels that can guide traders on potential price movements. The more times the price tests these levels without breaking through, the stronger these levels become. If the price breaks through resistance, that level could turn into support. Zilliqa (ZIL) remains in a “bearish phase,” but should the price rise above $0.060, it could signal a trend reversal, with the next target possibly around $0.080. The critical support level for Zilliqa is at $0.030, and if the price drops below this, it would trigger a strong “SELL” signal, potentially driving the price to $0.025.

Factors Supporting a Rise in Zilliqa (ZIL) Price

Although Zilliqa (ZIL) is still in a “bearish phase,” if the price breaks above $0.060, it could indicate a reversal in the trend, with the next target around $0.080. Traders should also keep in mind that Zilliqa’s price often correlates with Bitcoin’s price. If Bitcoin surpasses $25,000, we may see ZIL price levels rise significantly.

Indicators Suggesting Continued Decline for Zilliqa (ZIL)

Zilliqa (ZIL) has stabilized above $0.037, but a drop below $0.035 could signal a test of the $0.030 support. It’s important to note that $0.030 is a significant support level, and if it’s breached, it would likely trigger a “SELL” signal, opening the door to $0.025. Additionally, Zilliqa’s price movement is tied to Bitcoin’s performance, and any drop in Bitcoin’s price typically negatively impacts ZIL.

Analysts’ and Experts’ Price Predictions for Zilliqa (ZIL)

With inflation reaching 41-year highs and central banks tightening monetary policies, experts predict that risk assets such as stocks and cryptocurrencies may continue to experience losses. Federal Reserve Bank of St. Louis President James Bullard has stated that the U.S. central bank will likely need to raise rates further to control inflation. Bullard has suggested a potential rate increase of 75 basis points at the next Federal Open Market Committee meeting, which has already affected stocks and cryptocurrencies negatively. While these hikes are intended to tame inflation and support the economy, many investors are concerned that aggressive rate hikes could push the economy into a recession. Zilliqa’s price is also closely tied to Bitcoin’s price, and if Bitcoin drops below the $20,000 support level, ZIL could see new lows.