Zcash (ZEC) edged higher on Monday, attempting to stabilize after three consecutive bearish weekly closes left the privacy coin down roughly 30% from recent highs. The digital asset traded around $1,165 at the time of writing, following an 11% decline last week. Despite the modest rebound, persistent ETF withdrawals and shrinking futures exposure suggest that market participation remains subdued.
Grayscale Zcash fund sees third weekly outflow
Grayscale's ZEC-focused exchange-traded fund recorded $19.15 million in net outflows last week, according to SoSoValue data. Those withdrawals followed weekly outflows of $30.72 million and $93.56 million, bringing the three-week total to approximately $143.43 million. Although the pace of withdrawals has slowed, the continued negative flows indicate that redemptions are still outweighing new investment through the product.
The fund's activity represents one part of the wider Zcash market, but a return to sustained inflows would provide a clearer sign of renewed investor appetite.
Derivatives activity contracts
Participation in Zcash derivatives has also weakened. CoinGlass data showed futures open interest declining to $2.36 billion from $3.29 billion last month, down about $930 million, or 30%. Open interest measures the notional value of outstanding futures positions. Its decline suggests reduced exposure, although falling prices can also lower the dollar value of those positions.
The figures therefore point to a contraction in derivatives activity rather than proving that retail investors alone are withdrawing. Open interest also does not establish whether remaining traders are predominantly bullish or bearish. Combined with ETF outflows, however, the reduction leaves the rebound without clear evidence of expanding market commitment.
Technical resistance ahead
On the daily chart, Zcash remains below its 50-period Exponential Moving Average at $1,184, the first significant hurdle for buyers. Above that, a descending resistance trendline near $1,229 and the 200-period EMA at $1,240 form additional barriers. A sustained move through this resistance area would help ease the broader bearish pressure. Until then, recovery attempts remain vulnerable to renewed selling.
Momentum indicators offer only tentative encouragement. The Moving Average Convergence Divergence indicator is marginally above its signal line but remains in negative territory. Meanwhile, the Relative Strength Index sits below 50, suggesting bearish to neutral momentum rather than a decisive shift toward buyers.
Support levels to watch
On the downside, the September 4 high near $1,050 provides the next structural support reference, followed by the psychologically important $1,000 level. Holding that area would give buyers an opportunity to stabilize the price following the recent losses.
A sustained breakdown below $1,000 would weaken that prospect and bring the August 23 high around $888 into focus. That deeper target remains conditional on Zcash first losing the intervening support levels.
For now, ZEC's modest rebound needs follow-through above $1,184 and the wider resistance zone to offer stronger evidence that selling pressure is easing.
This article is for informational purposes only and does not constitute financial advice.
