Zcash sold
off sharply yesterday alongside many other cryptocurrencies as growth concerns led
to widespread risk aversion.
The
selling started late on Wednesday and then accelerated after The New York Times
reported that the US and Israeli militaries had prepared detailed plans for
potential strikes against Iran following the US midterm elections. The report
also indicated that US was reinforcing its military presence in the region,
with additional forces expected to be fully deployed by early November.
The risk
of another direct confrontation between the US and Iran, combined with growing
concerns about economic growth and the Federal Reserve forced to keep a hawkish
stance due to inflationary pressures, weighed heavily on the crypto market.
Today’s
US Flash PMIs will likely be another major catalyst. Soft readings could
intensify growth concerns and trigger another selloff in Zcash, while better-than-expected
data could ease growth fears in the near-term and lead to a relief rally.
However, this will likely be just a temporary recovery as the data would not
change the bearish backdrop.
ZCASH TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the
daily chart, we can see that Zcashtrimmed most of the weekly
gains yesterday amid the widespread risk aversion. If we get another pullback
into the 1,031 support, we can expect the buyers to step in, with a defined
risk below the level, to position for a rally into the 2,000 level. The
sellers, on the other hand, will look for a break lower to increase the bearish
bets into the 800.00 level next.
ZCASH TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME
On the 4
hour chart, we can see the price broke above the downward trendline and
eventually rallied all the way up to the key 1,350 level before pulling back.
If we get a recovery into the 1,350 level, we can expect the sellers to step in
there, with a defined risk above the level, to position for a drop into the
1,031 support. The buyers, on the other hand will want to see the price
breaking higher to increase the bullish bets into the 2,000 level next, with the
1,692 high as the first target.
ZCASH TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, we can
see the price broke below the upward trendline that was defining the bullish momentum.
The sellers piled in on the break to target a drop into the 1,031 level but the
price started to consolidate near the trendline. If we get a break of the
recent low around the 1,185 level, we can expect the sellers to increase the
bearish bets into new lows. The buyers, on the other hand, will need the price
to rise back above the trendline to start positioning for a recovery into the
1,350 resistance next. The red lines define the average daily range for today.
UPCOMING CATALYSTS
Todaywe conclude the week with the US Flash PMIs.
This article was written by Giuseppe Dellamotta at investinglive.com.