$ZEC Zcash is retreating towards an important support zone with strong seller control across various time frames. ZEC is trading near $363 after breaking key levels that supported the previous rise. This retreat reflects a market gradually losing momentum with the return of volatility and a clear change in derivatives activity, making traders watch whether the price will hold or continue to drop to deeper levels.
Increasing selling pressure with a break of key levels continues as ZEC records lower highs and lows, indicating ongoing weakness. The price is trading below the EMA-9 average at $406, while Supertrend resistance at $424 prevents any early attempt at recovery.
Breaking the Fibonacci level of 0.236 at $424 added more pressure and pushed the price to its lowest levels in weeks. The nearest support shows around $361, an area that previously saw buying interaction. A deeper break could expose the range of 320–300, while the level of 280 forms an important support for medium-term stability. Failure in these areas threatens to extend the decline that began after the price rise from $760.
Significant changes in derivatives activity have seen Zcash futures contracts jump notably this quarter. After a long period of calm, open interest rose from below $100 million to over $900 million between October and early December as traders anticipate strong volatility and seek to chase the rapid rise toward $700.
However, the pullback towards $426 reflects a phase of risk reassessment, as many traders have reduced their positions amid weakening momentum. Current figures indicate a more cautious market awaiting clear signals before building new positions.
Exchange flows reveal strong distribution as on-chain data indicates a significant shift in net flows. After relative neutrality between February and September, flows began to rise in October, and the pace of outflows increased in November. The latest reading recorded a net outflow of $39.34 million with ZEC trading near $364, indicating clear distribution pressure as traders take profits after the extended rise.
The governance debate adds additional pressure as the discussion around the governance model has resurfaced following Vitalik Buterin's comments expressing concerns about token-based governance and the long-term risks associated with privacy networks. This debate has highlighted the impact of governance on the development trajectory of identity-obscuring projects, making governance an additional factor that may affect investor sentiment in the near future.
The technical outlook for ZEC price remains clear with Zcash trading in a pressure zone near its lowest levels in weeks. The main resistances are at $406, $424, and $480. Breaking these levels could push the price back toward $569 and the mid-recovery area near the Fibonacci level of 0.5.
Support levels start from 361–360, then the range of 320–300. Breaking this range could expose ZEC to the level of 280, which is an important structural floor on higher time frames. The resistance at 424 is the critical level for reversing the trend in the medium term.
Will Zcash recover? The upcoming trend depends on buyers' ability to defend support at 361–360. A break above 406 then 424 will weaken the bearish structure and open the door toward 480 and possibly 569 if flows support this move. However, failing to hold above 361 threatens a return to 320–300 and possibly 280.
ZEC is currently at a pivotal zone. The decline in derivatives activity and continued outflows indicate a lack of confidence, but the tight range pressure suggests that a strong move is approaching. Interaction at support or a change in flow direction will be the critical element for the next step.
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