Zcash (ZEC) plunged through the $500 support and was trading around $406–$412, after a decisive technical breakdown. The move accelerated after reports of core developer departures and waning demand for shielded transactions, a mix that analysts say has flipped sentiment firmly negative.
The drop erased prior gains and produced a one-day fall of roughly 15–20%, and about a 23% decline over the past week, according to Yahoo Finance and Bitget. Analysts attribute the sell-off to technical exhaustion combined with a fundamental shock: an exodus from Zcash’s core development team cited by Yahoo Finance and Bitget. FXStreet flagged a stagnation in Zcash’s shielded pools, signalling lower usage of privacy features and softer underlying demand.
Market commentators from FXStreet, Bitget and BeInCrypto identified multiple bearish formations—symmetrical triangles, wedges and a head-and-shoulders setup—that together underpin warnings of an extended correction from current levels.
At the same time, exchanges and commentators pointed to an overheated futures market and strong retail participation, which can amplify downside when larger holders move to scale back exposure. That combination increases the risk that forced liquidations and funding stress will deepen short-term losses.
Technical picture and trading implications
Technicals are broadly bearish. FXStreet and Bitget noted that ZEC broke key trendlines and is approaching the $391–$404 support band; failing that zone would validate a deeper corrective phase. Momentum indicators cited in exchange and market write-ups show the RSI sliding, MACD producing bearish crossovers and Chaikin Money Flow registering outflows—signals consistent with distribution rather than consolidation.
Analyst targets diverge by severity: Bitget and BeInCrypto explicitly warn of a roughly 27% correction from current levels, with near-term downside targets around $363 or $300 if the $391–$404 zone gives way.
MEXC highlighted a classic head-and-shoulders pattern; if that pattern fully resolves, their analysis projects a far larger decline, down to roughly $80–$100—an extreme scenario that would require confirmed pattern completion and extended selling pressure.
For traders and managers the operational takeaway is clear: liquidity and positioning are fragile. Short-term strategies should account for possible sharp moves around the $391–$404 band and elevated volatility in futures markets that can trigger margin cascades.
Investors are now watching whether ZEC can hold the current support; a confirmed failure would push attention toward the $300–$363 area as the next practical test and, in a dramatic structural breakdown, the pattern highlighted by MEXC would become the defining risk to position size and hedging decisions.
