Zcash (ZEC) is hovering just above the $415.39 area at the time of writing. It is not what is most noteworthy here; the key thing is the price value in relation to the price action of the prior four weeks; it is currently testing just below a declining support line. This level historically acted as a resistance for every push above price since June, and it’s testing just above an accumulation of demand support levels. The market participants on the sell side have been squeezed, and the buyers are closing in to support the lower boundary of this digital asset.
The entire trend has been erased from the early june collapse
In the first week of June, the asset went through a correction from $640 to $303 before making a recovery above $400 within the subsequent day’s candle. This is visible clearly on the chart as a long downside wick that broke under the $303.25 support level. It is the reference point of everything that followed.
So what made the move so impactful? It was not just about the size of the trade but rather the rebound. The price did not cling to the $303 area but rebounded aggressively and wrapped up the day with trading over the price level of $400. That showed support had been put in place by the market bulls at that price level. The market backed the $303.25 level fairly well.
But the breakdown itself has also changed the configuration of the trend beneath it. In the June 5 timeframe, ZEC was following a range spanning approximately $490 and $680. Following June 5, every bounce in ZEC ended up with a lower high than the prior one. In fact, on June 13 the price gained bullish strength and peaked around the levels of $540.
By the time of June 17, the move reached a high near $520. This was followed by the attempts later in June that made this digital asset drop below $480. The trend high of $420 looks very close and in the best-case scenario, it can end up as a deviation setup.
This is the decision point after three weeks of selling
The 4-hour chart indicates that ZEC has spent the period from mid-June through July 1 grinding lower within a narrowing range. The upper boundary is the falling trendline. The lower boundary is a horizontal support zone near $398 to $403.
That lower zone has been tested at least three times in the final week of June and has held each time. Each test that holds without breaking suggests that selling pressure at those levels has been absorbed. That is a meaningful observation, not a guarantee.
The two boundaries are converging. A price that stays inside a narrowing range eventually runs out of room and has to break in one direction or the other. Based on the current trajectory, that decision arrives within the next several sessions.
Moving averages: The current trend is weak
ZEC has a 7-day simple moving average at $403.89 and there is a 30-day SMA at $449.13. In cases where the shorter average is lower than the longer one, we observe the same phenomenon demonstrated by the price chart. Clearly, there has been a recent downturn.
The $415 price level is still higher than the 7-period average, a weak short-term good thing, though the 30-period average is currently hovering at $449, and has demonstrated a solid ceiling for this asset in the past month. Any approach towards that area has triggered sell orders. The medium-term trend is going to stay weak as long as the price can actually break above that level and consolidate.
The 200-day SMA is standing at $377.86, which is well beneath the price in terms of longer-term context and at this point there is no immediate pressure.
The chart and Fib levels are on the same tack
Using ZEC’s swing low from $255.78 to its peak of $640.28, the 61.8 percent level is currently standing at $402.66. This retracement level is lying inside of the same $398 to $403 support zone that the chart has successfully defended on 3 prior instances. The 50 percent level is positioned just shy of the 30-period moving average that stands at $448.03.
