Required containers
- LayerZero (ZRO) fell nearly 3% on Monday, extending last week’s 9% decline.
- The network is set to open 25.71 million ZRO tokens, equivalent to 4.6% of the total supply, and increase the sales force.
- Despite the bull market’s reaction, the volume of futures trading rose 552%, indicating a strong interest rate.
- Technically, ZRO remains bearish, with support at $0.734 and a lower target near $0.532.
LayerZero (ZRO) extended its recent losses on Monday, falling nearly 4% as investors braced for one of the project’s biggest deals yet.
The token is already down about 9% over the past week, and the release of the 25.71 million ZRO spread may add some short-term selling.
Although the derivative works have reached the opening, the market conditions show that the traders will remain cautious about the future of the indicator.
Monthly token unlocking increases the supply pressure
According to Tokenomist data, LayerZero will open 25.71 million ZRO tokens on Monday, which represents about 4.6% of the total number of tokens.
The newly opened tokens will be given mainly to partners and top supporters.
At the same time, about 1.67 million ZRO, or 0.3% of the issued amount, will be redeemed through the purchase program.
The planned purchases may reflect confidence from the project’s core team, but additional spins are still expected based on short-term pricing as investors evaluate potential sales.
As institutional fragmentation is expected to rise, retailers will begin to do more in the LayerZero market.
CoinGlass data shows the volume of futures trading increased 552% in the last 24 hours to $248.65 million. Meanwhile, Open Interest (OI) increased by 4.52% to $80.87 million, indicating that new positions are entering the market.
The increase in the number of both trades and Open Interest shows the growing trend towards the opening of tokens.
However, attitudes seem to be changing. While business activity has risen sharply, futures payments have declined.
The currency dropped to 0.0061% from 0.0121% the previous day, indicating that demand for long positions is decreasing.
A drop in coin prices often reflects a drop in confidence among business investors, especially before the opening of major tokens that increase circulation and create expectations of additional pressure to sell.
The combination of speculative activity and weak business conditions suggests that investors should be cautious about going into a non-opening event.
LayerZero price forecast: Bears still rule
From a technical perspective, LayerZero continues to sell in a steady fashion.
The indicator remains below the 50-day Exponential Moving Average (EMA) near $0.957, reinforcing bearish momentum.
The trend is also bearish following the death cross formed in late April, when the 50-day EMA crossed below the 200-day EMA – a signal usually associated with a bearish trend.
Technical indicators continue to support the bearish trend. The Relative Strength Index (RSI) is read around 36, indicating strong bearish power as it sits above the oversold zone.
Both the MACD and signal lines remain below zero and continue to decline, indicating the bearish trend continues.
These indicators show that sellers continue to dominate despite the high volume of output.
The most important support for the bottom remains at $0.734, the main support for the formation is the Fibonacci anchor.
A definite break below this level could accelerate the sell-off and indicate the next technical target at $0.532. Reaching this level would represent a 25% drop from current prices.
If the buyers can resume the run following the opening of the signal, the first resistance area is around $0.945 (23.6% Fibonacci retracement), with another resistance at $0.957 (EMA 50).
A daily close above this resistance band would reduce the bearish momentum and could open the door to $1.325.
However, a retracement of the 50-day EMA is necessary before a recovery begins.
