Disclaimer: The information presented does not constitute financial, investment, trading or other type of advice and is solely the opinion of the writer.
Earlier in July, Bitcoin had a hopeful look at it on the charts. The bulls had seen BTC hit higher lows at $18.8k and $19.2k for two weeks in July.
On a positive note, the king of crypto pushed past the $21.7k resistance to reach $24k. However, this bullish impulse from last week was quickly stopped.
Over the weekend, Bitcoin started to bleed lower and the rest of the altcoin market followed in its footsteps. Zcash quickly fell from $65 to $56. By doing so, it flipped the $60 level into resistance and gave the bears a huge boost. Could ZEC also fall under its scope?
ZEC-12 Hour Chart
ZEC ranged between $69.7 and $51.9 in late June as the high and low were quickly tested. In doing so, a demand zone was established at $52, marked in cyan. Before the range was formed, Zcash was in a strong downtrend.
At the end of May, the $76-$82 area was seen as a support zone, but ZEC crashed right past it in the selloff in mid-June. Returning to April, this was something ZEC had done many times.
It saw strong shorter-term rallies, each of which was rejected at a previous lower high on the downtrend.
The 12-hour RSI was below the neutral 50 line to indicate that a bearish trend was underway. In terms of price action, the $69.7 level was the significantly lower high of the downtrend to beat to reverse the longer-term market structure.
ZEC- 4-hour chart
In July, ZEC appeared to offer a good buying opportunity just above the $50 area. After a strong downward move, $52.9 was a longer-term horizontal support level that presented a low-risk buying opportunity.
Within the range, the mid-range ($60.8) was a significant level, flanked by $65.2 and $56.3 levels, which are also key resistance levels. They represent the 25% and 75% of the range.
The 4-hour and lower time frames had a strong bearish look. The move below USD 60, and the subsequent retest as resistance, was a development that outlined bearish strength.
The 4-hour RSI has also fallen below neutral 50 in recent days and stood at 31.4 to demonstrate the seller’s dominance. The Awesome Oscillator also registered red bars on its histogram below the zero line, showing acute downward momentum.
The A/D line was at a support level as of late June when ZEC saw a jump out of the $52 zone. This performance may not be repeated. Caution was advised as the CMF also pointed to significant capital outflows from the market.
A return visit to the $52 demand zone looked like a good buying opportunity. Still, Bitcoin was weak on the charts and a move back below $20k for BTC cannot be discounted.
In light of such bearish expectations, it seemed safer to wait or sell Zcash rather than buy a demand zone that has been tested three times in the past month. Traders with lower time frames may wait for a retest of the USD 60 or USD 56 levels to enter short positions.
This post Zcash revisiting this demand zone may signal a buying opportunity
was published first on https://ambcrypto.com/zcash-revisiting-this-demand-zone-could-signal-buying-opportunity/