Zcash pares losses amid improved risk sentiment as focus shifts to US CPI and Winklevoss ETF approval

<p class="MsoNormal" style="font-family: Aptos, sans-serif; margin: 7px 0; line-height: normal; font-size: 15px;">Zcash’s recent selloff has been driven largely by broader crypto-market weakness, rather than a clear deterioration in its fundamentals. </p><p class="MsoNormal" style="font-family: Aptos, sans-serif; margin: 7px 0; line-height: normal; font-size: 15px;">Rising oil prices, higher Treasury yields and a stronger US dollar had weighed on risk appetite before the sentiment improved after Trump ruled out strikes on Iran before the November elections and triggered a relief rally in risk assets.  </p><p class="MsoNormal" style="font-family: Aptos, sans-serif; margin: 7px 0; line-height: normal; font-size: 15px;">The main upcoming catalyst for Zcash is the NU7 network upgrade. Testing is progressing, with developers expected to make a final mainnet activation decision on October 20, with November 5 targeted for launch. </p><p class="MsoNormal" style="font-family: Aptos, sans-serif; margin: 7px 0; line-height: normal; font-size: 15px;">The upgrade aims to reduce block times from 75 seconds to 25 seconds and introduce changes to the network’s reward and sustainability mechanisms. Successful implementation could improve the network’s functionality and support sentiment.</p><p class="MsoNormal" style="font-family: Aptos, sans-serif; margin: 7px 0; line-height: normal; font-size: 15px;">A second potential catalyst is the approval for the new Zcash ETF. On October 6, Winklevoss Asset Services filed for a proposed spot Zcash ETF, which is 10x cheaper than Greyscale’s ETF. The approval could give Zcash a boost on expected demand increase.  </p><p class="MsoNormal" style="font-family: Aptos, sans-serif; margin: 7px 0; line-height: normal; font-size: 15px;">On the macro and geopolitical side, the US-Iran negotiations continue as both sides try to get enough concessions to accept an eventual deal to reopen the Strait of Hormuz. On Wednesday, we also have the US CPI report that could trigger big moves in the markets. </p><p class="MsoNormal" style="font-family: Aptos, sans-serif; margin: 7px 0; line-height: normal; font-size: 15px;">A hotter than expected core CPI could raise the probabilities of a Fed rate hike in October and weigh on Zcash, while a soft report will likely give the cryptocurrency a boost on lower Treasury yields and US dollar. </p><p class="MsoNormal" style="font-family: Aptos, sans-serif; margin: 7px 0; line-height: normal; font-size: 15px;"> </p><p class="MsoNormal" style="margin: 0 0 11px; font-family: Aptos, sans-serif; line-height: 104%; font-size: 15px;">ZCASH TECHNICAL ANALYSIS – DAILY TIMEFRAME</p><p></p><p class="MsoNormal" style="font-family: Aptos, sans-serif; margin: 7px 0; line-height: normal; font-size: 15px;">On the daily chart, we can see that <a href="https://www.tradingview.com/symbols/ZECUSD/" rel="follow" style="color: rgba(70, 120, 134, 1); text-decoration: underline;">Zcash</a>broke below the major upward trendline and extended the losses as the sellers piled in to target a drop into the 1,031 level next. If the price gets there, 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 extend the drop into the 800.00 level next.</p><p class="MsoNormal" style="margin: 0 0 11px; font-family: Aptos, sans-serif; line-height: 104%; font-size: 15px;">ZCASH TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME</p><p></p><p class="MsoNormal" style="font-family: Aptos, sans-serif; margin: 7px 0; line-height: normal; font-size: 15px;">On the 4 hour chart, we have a downward trendline now defining the bearish momentum. If we get a pullback into the trendline, we can expect the sellers to lean on it, with a defined risk above it, to keep pushing into the 1,031 level. The buyers, on the other hand, will look for a break higher to pile in for a rally into new highs, with the 1,500 level as the first target.</p><p class="MsoNormal" style="margin: 0 0 11px; font-family: Aptos, sans-serif; line-height: 104%; font-size: 15px;">ZCASH TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME</p><p></p><p>On the 1 hour chart, there’s not much we can add here as the sellers will have a better risk to reward setup around the downward trendline where we have also a good support zone around the 1,280 level. The buyers, on the other hand, will need to wait for a drop into the 1,031 level or a break above the trendline to start positioning for new highs. The red lines define the <a href="https://investinglive.com/Education/trading-tip-know-the-average-daily-range-adr-20220207/" rel="follow" style="color: rgba(70, 120, 134, 1); text-decoration: underline;">average daily range</a> for today.</p><p class="MsoNormal" style="margin: 0 0 11px; font-family: Aptos, sans-serif; line-height: 104%; font-size: 15px;">UPCOMING CATALYSTS</p><p class="MsoNormal" style="margin: 0 0 11px; font-family: Aptos, sans-serif; line-height: 103%; font-size: 15px;"><a href="https://investinglive.com/EconomicCalendar" rel="follow" style="color: rgba(70, 120, 134, 1); text-decoration: underline;">On Wednesday</a> we have the US CPI report. On Thursday, we get the US PPI, the US Retail Sales and the latest US Jobless Claims figures.  </p> This article was written by Giuseppe Dellamotta at investinglive.com.