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Why Chiliz Is Losing Heat Despite World Cup Pomp; CHZ Down Over 30%

Since the beginning of the 2022 2FIFA World Cup, the value of Chiliz native token has plummeted.

Due to the discovery of various issues, the sporting event has been met with some controversies. Not to mention that just a week before the World Cup’s start, the collapse of the infamous FTX exchange shook the crypto world. But then, this is not the main point here.

Despite some promising advances off-chain, Chiliz continues to struggle. The token is down more than 30% in the last two weeks.

There is a lot of bearish evidence in the technicals and stats. If the price drops below $0.1451, short selling becomes an option.

This added strain to the already overburdened Chiliz ecosystem, which has had trouble drawing in investors and sports fans despite the testnet release of its Chiliz 2.0 update. However, CoinGecko reported a 1.3% price increase just lately.

When Will CHZ Get Its Zing Back?

On a green candlestick, the current price of CHZ is $0.1677. An oversold Relative Strength Index (RSI) value may help to clarify the recent increase in the token’s price.

However, the market is currently embroiled in a battle between bulls and bears, with prices remaining within the $0.3085-$0.1451 range that prevailed prior to the FTX brouhaha.

The market remains slightly mired in the distribution phase, with support and resistance being momentarily breached and reclaimed.

This has been true since the month of August. The situation may be deteriorating as CryptoQuant observes an increase in exchange reserves for the coin.

According to Messari, the volatility of the asset has been 2.13, indicating that it has been quite shaky. Having settled at -1.23, the returns relative to this volatility likewise exhibit extremely bearish characteristics.

Will There Be A Reversal?

Nonetheless, the MACD indicator indicates that a reversal is imminent. This may suggest a reversal due to the RSI being oversold. However, because exchange reserves are so high, any positive reversal would be met with a tremendous negative force.

A certain bearish breach of the $0.1451 support could cause the current market structure of distribution to collapse. A breach of this support might send the price to the 78.60 Fibonacci level.

A breakdown below this level could send the price to $0.0791. As the market recovers from the correction triggered by the FTX crash, CHZ should be able to ride this wave and emerge in a better shape.

CHZ total market cap at $1.02 billion on the daily chart | Featured image: DailyCoin, Chart: TradingView.com

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Chiliz (CHZ) Leads Market Gains With Over 8%

CHZ continues to lead the market in gains as more anticipation builds toward the World Cup. The go-to fan token was seen keeping an intraday profit of 7.37%. It reached a local high of $0.246 during the day before retracting to its current price of $0.242. Despite falling below its trading-day floor, it quickly bounced back, leaving traders with substantial profits.

CHZ week-on-week charts also indicate bullish momentum for the fan-themed token. Holding 8.58% profits, CHZ’s price looks confident over the entire market as tokens struggle to gain some ground. Despite the World Cup anticipation driving high trading volume, CHZ’s founder’s offer to bail out stranded FTX users also helped push prices higher.

As per data retrieved from CoinMarketCap, CHZ also holds gains against the top guns. At press time, CHZ held over 5% gains ahead of BTC and ETH. The token is already on a path to touch its intraday high and might see a positive break out.

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Chiliz’s price is currently hovering at $0.2436. | Source: CHZUSD price chart from TradingView.com

CHZ Founder Isn’t so Bullish On NFTs In The Sports Industry

Due to its connection with sports tokens, Chiliz has experienced a resurgence in investor interest in its native cryptocurrency, CHZ. Alexandre Dreyfus has seized the chance to emphasize why Chiliz has a promising future in the sports sector. 

The CEO talked about NFTs, which he mentioned was an awesome way to connect fans with their favorite teams. However, Dreyfus mentioned that most NFTs in the market lack utility. He added that this is a major reason why fans lose interest in these initiatives over time.

Dreyfus added that scalability might not be NFTs’ strongest suit. As a substitute, he said that fan tokens are a fantastic way to scale a team. This is so that teams may utilize them to create powerful digital communities since they are fungible. He added; 

It’s this ability to provide access and individual recognition to audiences at huge scale that sets Fan Tokens apart.

CHZ Active Wallets Increase As Supply On Exchanges Fall

The number of active addresses (30-day) has increased since November 6th. This demonstrated greater user interaction and may be a sign of an optimistic mood. Additionally, the weighted sentiment score was in the green, indicating that CHZ had a good social media outlook.

However, on-chain metrics revealed that throughout November, the percentage of supply on exchanges had decreased. This is quite unlikely, considering the huge drop in price within the week. Specifically, CHZ saw a price dump on the 14th that took its value to the $1.88 region. 

This drop is further witnessed in its 24-hour trading volume. Despite posting impressive intraday and week-on-week gains, the token trading volume dropped 24.38%. Even after all these, CHZ tokens have been moved off of exchanges. Given these stats, its active wallet increase might indicate that traders are not looking to spend their CHZ in the short term. This also suggests that there may be a buildup from bigger market participants.

Featured image from Pixabay and chart from TradingView.com