From CryptoPotato · By Dimitar Dzhondzhorov
The popular privacy coin, among the top performers earlier this year, has plunged by double digits over the past 24 hours, falling below the $1,000 psychological mark.
Many analysts now expect the asset to head further south, while some key factors suggest a bullish reversal may be just around the corner.
Back to Three Digits
Zcash (ZEC) has undergone a painful correction, losing roughly 14% of its value in the last day and currently trading around $975 (per CoinGecko). This also represents a whopping 42% collapse from the multi-year high of approximately $1,700 reached this September. Following the pullback, ZEC’s market capitalization dropped to nearly $16.6 billion, meaning it is no longer among the 10 biggest cryptocurrencies after Hyperliquid (HYPE) overtook it.
Its decline comes amid a broader market correction, yet its magnitude is surprising given Grayscale’s latest effort. The leading digital asset manager revealed that it will reinvest 100% of its ZEC ETF sponsor fees into the Zcash network across development, marketing, community, and education.
Several analysts think there is no immediate bounce in sight and anticipate further declines. X user Altcoin Sherpa expects an ultimate bottom in the $800-$900 range before a potential reversal.
Crypto Patel was even more pessimistic, advising investors to book 50% of their profits here and “trail the remaining position with a disciplined stop-loss.” In their view, the price could crash all the way down to the $500-$200 zone.
Meanwhile, the correction has negatively impacted a mysterious market participant who previously opened a 10x long on 18,000 ZEC ($17.63 million) and is now sitting on a major loss of over $2.8 million (at least on paper). The trader will be fully liquidated if ZEC collapses to around $895 unless they provide additional collateral to keep the position open.
The Bullish Outlook
Certain factors, including ZEC’s Relative Strength Index (RSI), suggest that the asset may stage a short-term recovery. The technical analysis tool, which measures the recent magnitude and speed of price changes, runs from 0 to 100, and can give traders an idea of potential reversal points.
Readings below 30 indicate that the asset has entered oversold territory and could be gearing up for a rebound, while anything above 70 is typically considered a warning for an impending pullback. Currently, the RSI stands at 29.
ZEC RSI, Source: RSI Hunter
Next on the list is ZEC’s exchange netflow. Over the past several days, outflows have surpassed inflows, meaning that investors have abandoned centralized platforms in favor of self-custody wallets, thereby reducing immediate selling pressure.
ZEC Exchange Netflow, Source: CoinGlass