The Tezos price has bounced back after it staged a major retracement earlier this week. The XTZ price jumped by more than 6% and is trading at $5.90, which is about 185% above the lowest level in July. The coin has a market capitalization of more than $5 billion. It is the 31st biggest token in the world and is sandwiched between Cosmos (ATOM) and eCash (XEC).
Why is Tezos rising?
There are three possible reasons why the Tezos price is bouncing back. First, investors are selling the dip after the cryptocurrency crashed hard earlier this week. As you will see below, the decline found a strong support at a key technical and psychological level.
Second, the XTZ crypto is surging because of the overall growth of its network. Recently, the developers announced that InCore Bank, a leading Swiss bank was adopting its technology. The bank, in collaboration with Crypto Finance AG will launch a tokenization tool. This tool will help customers launch tokenized assets in the market.
Third, Tezos has become a popular blockchain tool in the non-fungible tokens (NFT) industry. And recently, the platform was chosen by The Whitworth in the UK. The new launch is in collaboration with Vastari Labs as it seeks to raise money from digital art. Other large auction houses like Christie’s and Sotheby have also shifted to NFTs to boost their sales. So, what next for the XTZ price?
Tezos price prediction
The daily chart shows that the Tezos price rose to $6.09 early this week. It then dropped sharply during the recent cryptocurrency sell-off. Notably, it dropped to $3.70, which was a notable level since it was along the neckline of the inverted head and shoulders pattern. I had actually predicted this meltdown in my previous piece.
Today, the coin jumped to a new multi-month high of $6.5670, which is above the 25-day and 50-day moving average.
Therefore, the coin will likely maintain the bullish trend as bulls target the next key resistance level at $8, which is about 30% above the current level. On the flip side, a drop below $3.70 will invalidate the bullish view.