Zcash (ZEC) has retreated sharply from this week's record high, with the privacy-focused cryptocurrency now testing a key psychological support level. After peaking near $1,300 on Sept. 9, the token has fallen 12.5% in the past 24 hours to around $1,087, according to CoinGecko data. The session saw ZEC dip as low as roughly $1,056 before a slight recovery.
Despite the pullback, ZEC remains up 15.1% over the past seven days and 125.7% over the past month. The recent decline comes amid broader risk-off sentiment, as rising oil prices and higher U.S. Treasury yields pressure assets across the board. Brent crude climbed toward $110 a barrel on Friday on concerns over Middle East supply disruptions, while the 10-year Treasury yield rose to 4.965%. Markets are pricing a 71.3% probability of a 25-basis-point Federal Reserve rate hike at its meeting ending Sept. 16, according to CME FedWatch data.
Bitcoin slipped 0.8% to around $76,624 during Asian trading, while Ether fell a similar amount to near $2,443. The U.S. dollar held close to its highest level in a week, adding to headwinds for risk assets.
ZEC's sell-off follows a much steeper run than the broader crypto market. The token had gained roughly 170% in the month before reaching its record, leaving many traders with substantial unrealized profits. Selling pressure emerged after ZEC failed to sustain moves above the $1,250–$1,300 zone, with the 24-hour chart showing repeated drops through $1,200, $1,150, and $1,100.
The preceding rally was fueled by strong demand for Grayscale's Zcash ETF, which crossed $500 million in assets within two weeks of its Aug. 25 listing. The fund has accumulated more than 550,000 ZEC, representing roughly 3% of the circulating supply. A Sept. 8 SEC filing revealed that DCG International Investments acquired about $100 million of ZCSH shares in exchange for 85,705.33 ZEC. This combination of rapid price appreciation and reduced available supply helped push ZEC toward $1,300.
Now, the focus shifts to whether ZEC can hold above the $1,000 mark. A break below $1,050 would bring the psychological $1,000 level into play, followed by the 20-day exponential moving average (EMA) near $962. A daily close below the 20-day EMA would leave little visible support before the 50-day EMA at $773.10. Notably, ZEC last traded below its 20-day EMA in August, before the steepest part of the rally began.
Technical indicators on the daily chart still show a bullish longer-term structure, with price above the 20, 50, 100, and 200-day EMAs. However, the Commodity Channel Index (CCI) has fallen sharply from above 400 to 64.02, signaling that extreme positive momentum has unwound. On the 4-hour chart, the Parabolic SAR is positioned above price at $1,255.27, indicating ongoing selling pressure, while the Money Flow Index (MFI) has dropped to 36.29 from above 60 earlier in the week, showing weakened buying interest but not yet oversold territory.
For the downside to lose momentum, ZEC would need to reclaim the $1,120–$1,150 region. A move above $1,150 could open a retest of $1,200, with the 4-hour Parabolic SAR near $1,255 acting as a higher barrier before the $1,294–$1,300 resistance zone. Conversely, a decisive break below $1,000 could expose the 20-day EMA near $962, and further losses could accelerate if leveraged long positions face forced liquidations.
As the market digests the recent surge, traders are watching whether ZEC can stabilize above four figures. The broader crypto environment remains sensitive to macroeconomic factors, including oil prices and Fed policy expectations. Meanwhile, the ETF-driven rally that propelled ZEC to record highs may be losing steam, but the token's long-term trend remains intact as long as it holds above key moving averages.
This article is for informational purposes only and does not constitute financial advice.
