ZEC Falls Below $500 as Traders Consider Sell Opportunities

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ZEC
$516.922.48%
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ZEC slipped below $500 as technical indicators show a bearish trend following the Ironwood (NU6.3) testnet upgrade on July 2nd. The coin rose 37% in two weeks but has since dropped 13.6% in seven days. The RSI is below 50, and the -DI line has climbed above 20, reinforcing the bearish trend. The $500 level has become a supply area, making it harder for ZEC to break key resistance. Traders are watching technical indicators closely as selling pressure builds.

Zcash [ZEC] deployed the Ironwood [NU6.3] upgrade to testnet on 2nd July. The privacy token rallied by 37% over the following two weeks, breaching the $500-supply zone.

This upward momentum has since evaporated though. Over the past week, ZEC has lost 13.6% of its value, with the altcoin down by 3.1% in the past 24 hours alone. Thanks to the same, ZEC is now back below the $500-mark.

Since Sunday, 19th July, ZEC has posted red candles on the daily timeframe. Will this streak continue over this weekend too?

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The long-term ZEC trend is bullish, but momentum faces hiccups

ZCash 1-day Chart
Source: ZEC/USDT on TradingView

The swing structure, based on the rally from $20.7 to $750, was bullish. Within this structure, ZEC has faced much tumult so far. The latest development, the downturn below $500, was not a catastrophic outcome across the higher timeframes though.

Yes, the RSI slipped below neutral 50. The Directional Movement Index’s -DI (red) was climbing above 20, an early signal of a bearish trend in progress. The A/D indicator has shown weak demand in July too.

The $500-area has been contested since May. It has been flipped to a supply zone once more, weakening the bullish case in the short-term. However, in the long-term, this setback might not be too grievous for the buyers.

Traders’ call to action – Sell

In the short-term, ZEC’s inability to flip $560 to support and break $644 may be a sign of weakness.

ZCash 4-hour Chart
Source: ZEC/USDT on TradingView

At press time, the H4 structure was bearish and Zcash has faced rejection from the 78.6% Fibonacci retracement level at $560. Further downside could be likely.

The RSI was hovering around the oversold territory, a sign that the price might bounce towards the 20-period moving average at $501 before sliding lower.

ZCash Liquidation Heatmap
Source: CoinGlass

Finally, the liquidation heatmap showed how the short liquidations built up below $600 were targeted and taken out during the mid-July rally. The reversal since then is likely to target the $360-area, the next magnetic zone.

The 4-hour timeframe presented a price target of $250 swing low made after the Orchard bug was discovered.

Final Summary

  • Zcash’s rally beyond $500 lasted less than a week before reversing.
  • Liquidation heatmap and price action charts presented the $360 and $250-levels as the next bearish targets for ZEC.
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