Zcash trims losses as risk sentiment improves; CPI and Winklevoss ETF take focus

The latest decline in Zcash owes more to weakness across the wider crypto market than to any clear erosion of the token's fundamentals.

Firmer oil prices, higher Treasury yields and a stronger US dollar had earlier discouraged risk-taking. Once Trump ruled out strikes on Iran before the November elections, sentiment recovered and a relief rally carried through risk assets.

Looking ahead, Zcash's next major catalyst is the NU7 network upgrade. Testing is moving along, and developers are expected to make a final mainnet activation decision on October 20, with November 5 targeted for launch.

The upgrade is designed to reduce block times from 75 seconds to 25 seconds and to modify the network's reward and sustainability mechanisms. A successful rollout could improve the network's functionality and support sentiment.

Approval of a new Zcash ETF is another potential catalyst. On October 6, Winklevoss Asset Services filed for a proposed spot Zcash ETF that is 10x cheaper than Greyscale's ETF. If approved, the fund could give Zcash a boost on expectations of increased demand.

On the macro and geopolitical front, US-Iran negotiations are continuing, with both sides seeking enough concessions to accept an eventual deal to reopen the Strait of Hormuz. Wednesday's US CPI report could also set off large market moves.

Core CPI above forecast would raise the odds of a Fed rate hike in October and weigh on Zcash. A soft report would likely lift the cryptocurrency as Treasury yields and the US dollar come down.

ZCASH TECHNICAL ANALYSIS – DAILY TIMEFRAME

Zcash has slipped beneath the major upward trendline and extended the decline, with sellers targeting a drop into the 1,031 level next. If price reaches that zone, buyers are expected to step in with a defined risk below it to position for a rally toward 2,000. Sellers, meanwhile, will be looking for a break lower to push the move on to 800.00.

ZCASH TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME

A downward trendline is now defining the bearish momentum. On a pullback to that trendline, sellers are expected to lean on it, with risk defined above, and keep pressing toward 1,031. Buyers, on the other hand, will need a break higher to pile in for a rally to new highs, with 1,500 as the first target.

ZCASH TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME

There is little more to add at this timeframe. The sellers have the better risk-to-reward setup around the downward trendline, where a good support zone also sits near 1,280. The buyers will have to wait for a drop into 1,031 or a break above the trendline before positioning for new highs.

UPCOMING CATALYSTS

Wednesday brings the US CPI report. Thursday's schedule includes the US PPI, US Retail Sales and the latest US Jobless Claims figures.