Privacy-focused cryptocurrency zcash is solidly bid against the dollar and could soon see a spike against bitcoin.
As per data source CoinMarketCap, zcash (ZEC) has appreciated by 12 percent in the last 24 hours. As of writing, it is trading at $718 levels – that’s down 24.83 percent from the lifetime high of $955.26 set on Jan. 7, but, week-on-week, the cryptocurrency is up 22 percent.
ZEC’s retreat from the record high of $955.26 could be associated with overbought technical conditions and broad-based drop in cryptocurrency prices due to fears of trading restrictions in South Korea. Prices hit a low of $601.87 on Monday, and have since struggled to extend gains above $730 levels.
That said, the price chart indicates an upside break could happen soon.
The above chart (prices as per Bifinex) shows:
- Strong dip demand below $600 as shown by candles with long tails (gap between intraday low and close).
- A series of higher lows (as represented by rising trend lines) indicates bulls are in control.
- 10-day moving average (MA) carries a bullish bias (sloping upwards).
- The RSI is holding above 50.00 (bullish territory).
- A break above $732.78 (yesterday’s high) would add credence to above listed bullish factors and open doors for retest of $800. Further gains towards $1,000 cannot be ruled out in the short-term, given the RSI is well short of the overbought territory.
- On the downside, only a close (as per UTC) below $571.18 (Jan. 11 low) would signal a bullish-to-bearish trend change.
As of writing, ZEC is trading at BTC 0.05. The above chart (prices as per Bittrex) shows a long-term bullish trend reversal:
- A breach of the descending trendline followed by an inverse head-and-shoulders breakout (bullish reversal pattern).
- The 50-day MA has bottomed out.
The fact that ZEC witnessed an inverse head-and-shoulders breakout at the bottom of the long-term downtrend adds credence to the argument a long-term bullish trend reversal has been confirmed.
- ZEC looks set to test BTC 0.0749 (38.2 percent Fibonacci retracement) in the short-run, and may even extend gains to BTC 0.10.
- Short-term overbought conditions may yield a pullback, though the outlook would remain bullish as long as prices hold above the 50-day MA (currently seen at BTC 0.0337).
Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Zcash Company, the for-profit entity that develops the zcash protocol.
Arrow on road image via Shutterstock
The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Interested in offering your expertise or insights to our reporting? Contact us at email@example.com.
Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.