Important points
What’s driving the renewed optimism on ZCash despite its recent 14% decline?
Rising miner profitability, increasing hashrate, and surging trading volumes are fueling bullish sentiment.
How are investors reacting to market changes in ZEC?
Spot investors have resumed accumulating and large holders such as Arthur Hayes are expressing strong confidence.
Zcache [ZEC] We have seen one of the steepest drawdowns in the past day. Interestingly, market odds indicate a potential upside despite the 14% decline.
Miner activity and retailer interest are expected to play a key role in supporting the asset and facilitating a potential recovery. Here’s how it plays out.
Price trend: ZEC to $1,000?
A closer look at the on-chain price dynamics shows that ZEC has a strong tendency to break above $1,000 before encountering a major resistance point, usually a local top.
This outlook follows ZEC’s successful breakout past several reversal points on the chart as the asset trends towards the ‘high’ zone.
Source: Alpha Lactal
A rally towards the $1,000 area would put the asset at a new all-time high and, more importantly, it would be subject to price discovery.
Notably, this level represents a historical peak for the asset and suggests that the decline may continue once that zone is reached.
Factors supporting the upper price of ZEC
Several factors can significantly impact ZEC’s momentum in the market.
One important metric is the Puell Multiple, which measures a miner’s profitability on an annualized basis. Current statistics show that miners continue to make profits and there are no signs of a large-scale sell-off yet.
Source: Alpha Lactal
The network’s hashrate has also increased sharply, suggesting that more transactions are being verified by miners.
This trend suggests that network activity is growing, supported by a surge in transaction volumes. In the past 24 hours, ZEC’s trading volume increased by 138% to $4.61 billion, indicating new participation in the market.
Spot investors return
Spot investors re-entered the market after several days of consistent selling from November 3rd to 7th, during which time they sold approximately $153.49 million worth of ZEC.
The trend then reversed. In the past 24 hours as of this writing, spot investors have accumulated $34.46 million worth of ZEC. This is an encouraging change that reflects renewed confidence, especially among long-term holders.
Source: Coin Glass
Investor sentiment also appears to be strengthening. BitMEX co-founder Arthur Hayes revealed that his family office, Maelstrom, currently holds ZEC as its second-largest liquidity position after Bitcoin.
“Due to rapid price appreciation, $ZEC is now the second largest LIQUID holding in @MaelstromFund’s portfolio after $BTC,” Hayes said.
This confirms the bullish outlook on ZEC and suggests that spot investor confidence may continue to grow in the coming days.