- Zcash could resume the uptrend to $75 as long as the price makes a daily close above the 50 SMA.
- Despite the technical picture being optimistic, on-chain metrics paint a bearish picture for ZEC/USD.
Zcash, the privacy-oriented altcoin, is nursing wounds after a paralyzing 29% drop from the November peak at $89.5. Support was embraced at $63.5, refocused ZEC upwards. Resistance at $70 is currently an uphill battle, but ZEC seems poised for recovery to higher levels.
ZEC eyes gains to $75 before resuming the uptrend to $90
Zcash is trading at $69.9 after making a shallow recovery from the primary support, slightly above the 200 Simple Moving Average on the 4-hour chart. Marginally above the prevailing market value, ZEC/USD is battling a seller congestion zone at the 50 SMA.
A daily close above the 50 SMA would encourage more buy orders as investors look forward to trading above $75. The journey to $90 might run into delays at $80. On the other hand, support at the 100 SMA has to remain intact for the bullish outlook to materialize.
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ZEC/USD 4-hour chart
Recently, the TD Sequential indicator presented a buy signal on the ZEC/USD 4-hour chart, adding credibility to the optimistic outlook. The signal manifested in a red nine candlestick and estimated a spike in demand for Zcash likely to see it spike in one to four daily candlesticks. However, if buying pressure becomes strong enough, the privacy-focused token could take up a new upward countdown.
ZEC/USD 4-hour chart
It is worth mentioning the slump in the number of new addresses joining the Zcash network, according to IntoTheBlock’s “Daily New Addresses” on-chain metric. The model highlights a significant drop in the number of newly-created addresses, precisely from roughly 5,500 on November 20 to zero (as from November 24).
-637420472632992923.png)
Zcash new addresses chart
In other words, the bullish technical outlook may be invalidated if the newly-created addresses fail to recover in the near term. A downtrend in network growth such as this is usually a red flag for the token’s price. If the decrease sustains, the price may continue to dwindle, delay recovery, or give way for more losses.
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