Illuvium Could Double in Price

Following its uninterrupted rise in November of 2023, the Illuvium (ILV) underwent some consolidation before marking new all-time highs during its bull run in early 2024.

Currently, ILV is situated above what is regarded as a sturdy support level, and the gaming-focused token may be set to soar once more to familiar peaks.

The short-term consolidation observed in the daily timeframe suggests an impending impulsive move. But will this move favor the buyers or the sellers? Certain factors distinctly increase the likelihood of one direction over the other.

Weekly time frame

ILVUSD - 1 Week Time Frame

On the weekly timeframe, we observe a corrective move following the breach of an External Higher High. This move has approached an area defined by two fundamental parameters: first, a bullish Order Block (OB) consisting of three bearish candles; second, a support zone identified by the Fair Value Gap (FVG), which aligns precisely with the upper two quadrants of the OB, 0.5 and 0.75.

For those holding current buy positions, it's crucial to monitor the FVG in terms of its openness. A closure below this level on the weekly chart would invalidate the buy positions, significantly increasing the likelihood of a price decline triggered by the selection of External Sell-side Liquidity.

Daily time frame

ILVUSD - 1 Day Time Frame

In the daily timeframe, the price has engaged External Sell-side Liquidity and is now confined within the support and resistance zones, delineated as Fair Value Gaps (FVG).

Building on the analysis from the weekly timeframe, for bullish momentum to continue, it is essential that the price closes above the upper FVG. This closure would signal traders and investors to consider entering the market as buyers.

However, full volume should not yet be committed due to the ongoing corrective movement observed on the weekly timeframe. A Stop Loss (SL) order should be placed below the local low, targeting both Internal and External Buy-side Liquidity.

Should the price close below the lower FVG, there is a strong potential for the continuation of the bearish correction. This would suggest an enhanced probability of further downward movement, thereby providing a strategic point for traders to adjust their positions accordingly.