Journalist
Published:
ZCash, the token that made privacy the talking point in the crypto ecosystem, was rallying once again. It was up 8.4% in 24 hours.
The bullish momentum was due to a combination of technical and ecosystem developments.
While the privacy token seemed poised for a rally towards the end of the year, Bitcoin (BTC) and Ethereum (ETH) ETF flows were discouraging.
Demand for BTC and ETH has dried up over the past six weeks, ETF spot flows showed. Meanwhile, ZCash has seen its token utility expanded, with holders gaining access to yield opportunities.
The sustained defense of the $400 support zone has also been a positive development over the past two weeks. AMBCrypto analyzed whether the conditions for swing traders to go long were met.
ZCash: the bullish bias remains
Source: ZEC/USDT on TradingView
The 3-day time frame showed a bullish swing structure. The internal structure has not yet reversed bearishly, despite the retracement to the 61.8% level at $315 towards the end of November.
CMF saw significant outflows, which was a worrying sign for buyers. The MACD also reflects weakening momentum over the past month, even as ZEC defended the psychological $400 level.
A move above $476, the recent high, would signal a continuation of the uptrend. In this scenario, $600 and $750 would be the next goals.
The potential for a bearish shift
Weak buying pressure and declining bullish momentum have shown swing traders that a break below $400 poses a real threat.
A drop below $371 would be the first real warning sign that ZEC prices are likely to reach $300 or lower.
Trader Call to Action – Time to Buy ZEC
Source: ZEC/USDT on TradingView
On the 4-hour time frame, the structure was bullish again. The $400 support was defended.
Although the technical data has not been completely bullish over this period, the price action has shown where long traders can consider bidding.
The $450 area was short-term resistance, and ZEC could see further decline in this region. The imbalance between $416 and $434 (white box) may soon be tested as a demand zone.
A decline below $404 would invalidate this setup. A sustained fall below $371 would signal swing traders to change their bearish bias.
Final Thoughts
- ZCash’s rally has been driven by the expansion of token utility as well as technical developments, such as the defense of the $400 level.
- Swing traders could look to buy ZEC in the $416-$434 demand zone, with the invalidation being the local low just above $400.
Disclaimer: The information presented does not constitute financial, investment, business or other advice and represents the opinion of the author only.
