ZCash has turned a sharp 20% drop into an institutional accumulation opportunity. With $46 million flowing into Grayscale and a record confidential pool, could ZEC finally kickstart a trend reversal? Key levels reveal a crucial technical battle unfolding in the upcoming sessions.
Zcash has just gone through 48 hours that have profoundly changed market perception around this privacy-focused asset. On October 17, when Bitcoin broke the psychological support level of $105,000, ZEC plunged to $190, recording an intraday correction of 20%. This brutal volatility could have sparked panic, but instead triggered an immediate reaction from institutional investors and seasoned traders who spotted an accumulation opportunity at deeply oversold levels.
The question now: is this just a technical bounce or are we witnessing the beginnings of a structural reversal supported by solid fundamentals? Recent data from the Grayscale fund and the evolution of the privacy pool provide particularly instructive answers.
The figures speak for themselves. Grayscale’s Zcash fund has recorded $46 million in net inflows this month, marking a resurgence in institutional interest rarely seen for this asset. For context, Grayscale traditionally represents a reliable barometer of qualified investors’ appetite for alternative cryptocurrencies. These capital inflows come precisely when the price was testing critical support levels, suggesting a deliberate accumulation strategy rather than simple trend-following behavior.
The timing of these inflows coincides with a fundamental technical data point. Zcash’s privacy pool has reached 4.42 million ZEC, approximately 27% of the total circulating supply. This metric is crucial because it represents tokens locked in private transactions, mechanically reducing the liquid supply available on exchanges. With the privacy pool now valued at $1.12 billion, potential selling pressure is structurally diminishing.
This combination of institutional accumulation and reduced liquidity creates a favorable technical setup. Large wallets appear to be betting on future ZEC appreciation. Likely anticipating increased demand for privacy solutions in an evolving global regulatory context.
ZEC is currently trading around $215.15, with a market capitalization of $3.52 billion. After touching $190, the price has stabilized at the 38.2% Fibonacci retracement level, a technical level that traders systematically monitor during corrections.
On the 2H chart, ZEC sits at its POC at $213 and above the median band of the Fibonacci Bollinger Band at $206. This zone will be crucial for ZEC to bounce back and attempt to reach between $313 and $346 in the coming days. That’s a potential 40% increase.
However, caution remains essential. The $220 level now constitutes a major psychological and technical pivot. Consecutive closes above this barrier would validate a momentum change and open the path toward the next resistance levels at $238 and then $265.
Conversely, an inability to defend $190 in case of a retest would expose ZEC to a deeper correction toward the $157 zone, corresponding to the next significant Fibonacci support.
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Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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