Zcash was rejected at $251 and lost the $250 support level shortly after. Since then, the altcoin has closed at lows for three consecutive days, hitting a low of $205.
At the time of writing, Zcash (ZEC) was trading at $207, down 8.29% on the daily charts. Thanks to sustained monitoring On the downside, ZEC fell further below its short- and long-term moving averages, indicating intense downward pressure.
Buy-side liquidity declines as selling pressure intensifies
After a long bearish streak in the market, Zcash holders began to close their positions while speculators retreated. In fact, the market recorded higher sales volume, as evidenced by the CVD Spot Taker.
The altcoin faced massive selling pressure below $250 as short-term holders capitulated and began closing their positions.
Over the past two days alone, downward pressure, as sellers defended $210, contributed to a significant decline and fended off any attempts to break above.
Source: CryptoQuant
At the same time, buy sell volume to price pressure remained negative for two consecutive days.
At press time, OPV1 was around -22, while OPV2 was around -10. Here, a negative value means that price pressure is negative for both sellers and buyers. As a result, even net buying was negative, suggesting that selling pressure dominated buying pressure.
Source: Tradingview
Along with this, the demand index also fell into the negative zone. It showed a value of -25, suggesting lower demand relative to supply. With the index being negative and trending downward, it still appears to support the current market decline.
Traditionally, weak demand and increased supply accelerate downward momentum, leading to lower prices. In fact, the altcoin momentum indicator was indicative of this downtrend.
Source: Tradingview
To begin with, the altcoin’s Stochastic Ergodic Indicator (SMII) made a bearish cross, falling to -0.23. When this indicator falls into the negative zone, it hints at a strong downside risk with sellers exercising complete control over the market.
Historically, these market conditions have also preceded a decline in prices.
Retail tries to absorb growing pressure
Despite continued market weakness, some stock market investors took advantage of the opportunity to accumulate at a discount.
In fact, CoinGlass revealed that over $48.3 million was withdrawn from exchanges, compared to $43.9 million inflows over the past 3 days. This period coincided with a significant drop in ZEC’s price charts, with the same highlighting a greater drop in purchases.
Source: Coinglass
The increased accumulation provides ZEC with much-needed relief and could help the altcoin avoid further declines. Often, higher buying pressure helps absorb market pressure, thereby increasing the upside potential of assets.
Therefore, if demand becomes significant and finally manifests in the market, ZEC could experience a trend reversal and reclaim its short-term resistance at $238.
However, if the prevailing trend continues, with sellers overwhelming the market, Zcash is likely to break through the $200 support and drop as low as $185.
Final summary
- Zcash’s (ZEC) bearish streak persists, with memecoin falling 8.29% to a low of $205.
- ZEC experienced low buy-side liquidity and intense selling pressure, threatening to drop below $200.
