LayerZero (ZRO) Price Rises Over 100% From March Low — Overbought Signal Flashes Caution

Key Takeaways

• A five-wave impulse topped at $3.40 recently.
• LayerZero is likely forming a corrective A-B-C structure.
• The momentum indicator signals weakening momentum after an overbought peak.
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LayerZero (ZRO) has recently emerged from a prolonged downtrend and shown signs of structural recovery.

A breakout from a falling wedge and a five-wave advance suggests the asset has entered a corrective retracement after topping near $3.60.

The following analysis explores whether ZRO is poised for continuation or a deeper pullback before resuming upside momentum.

ZRO Price Analysis

On the 4-hour chart, ZRO has completed a five-wave downward correction labeled A-B-C-D-E, bottoming near $1.56 from its all-time high of $7.58.

The rebound from this key support area followed a descending wedge breakout—a typical reversal pattern—marking the potential end of the correction.

Subsequently, ZRO advanced impulsively to $3.60, rising by 145%, presenting a clear five-wave move of a lower degree.

This structure suggests the beginning of a new upward cycle or the first leg (wave A) of a broader correction.

However, the current price action stalled beneath the 0.382 Fibonacci retracement level as it reached the overbought zone.

After peaking in overbought territory, the Relative Strength Index (RSI) is now reversing, hinting at declining momentum.

The 0.236 Fib level at $2.986 is a key inflection point.

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A decisive move above this would suggest a bullish continuation, but the price is now vulnerable to a pullback.

Major support lies at $2.51 and $1.96—aligned with Fibonacci projections and previous accumulation zones—making them strong candidates for a corrective wave low.

ZRO Price Prediction

On the 1-hour chart, ZRO has entered a textbook A-B-C corrective phase following the recent peak.

Wave (a) completed near $2.75, wave (b) rebounded to $3.40, and wave (c) is now likely to develop.

Fibonacci extensions place wave (c)’s probable termination at $2.51 (1.0 extension) or deeper toward $1.96 (1.618 extension).

If the price reaches these zones, traders should watch for bullish divergences or reversal patterns to validate a new impulse.

RSI remains neutral with a slight downward bias, reinforcing the corrective narrative.

Failure to hold above $2.85 could accelerate the descent. If the $2.51 level fails to support, $1.96 becomes the next key demand area.

These zones offer potential high-reward entries for buyers expecting the next wave up.

If the price breaks above $3.40, a bullish invalidation occurs, implying that wave (c) was truncated and that a larger bullish impulse is underway.

On the higher time frame, the next resistance is near $3.86 (0.382 Fib) and $4.57 (0.5 Fib).

LayerZero may enter a short-term pullback phase, but key Fibonacci zones could act as springboards for the next bullish wave.

Should the price action develop as expected and establish a higher low, that could imply ZRO is entering a new bull phase with long-term upside ahead.

Key Levels to Watch

• Immediate Resistance: $3.20 (0.236 Fib of wave a).
• Major Resistance: $3.60 (wave (v) top).
• Immediate Support: $2.854 (0.618 retracement).
• Correction Targets: $2.51 (1.0 Fib extension), $1.96 (1.618 extension).
• Critical Support: $1.564 (March low and wedge base).
• Invalidation Level: Break above $3.60 confirms continued impulse.