cryptoanalysis

Analysis:
$XLM is currently showing a promising technical setup on the chart. We can observe a potential "N-Pattern" formation, which often signals the start of a new bullish wave.
Key Levels to Watch:
• Entry Zone: Current price levels around $0.20 are acting as a strong base for a potential bounce.
• Main Target: If the momentum continues, the next major resistance target is $0.50.
• Potential Gain: An upside of approximately 140% if the scenario fully plays out.
⚠️ Disclaimer:
This analysis is for educational and informational purposes only and does not constitute financial advice. Technical patterns represent probabilities, not certainties. Always manage your risk carefully.
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Zcash (ZEC) has remained under sustained selling pressure over the past two weeks, and the broader market structure continues to favor the bears. Since mid-January, price action has shifted into what now appears to be a confirmed breakdown phase — one that could still point toward a further 35% downside if key support levels fail to hold.
However, beneath the surface, not all participants are aligned with the bearish narrative. While retail traders continue to exit on short-term rebounds, large holders are quietly increasing exposure, creating a clear divergence between price structure and capital behavior.
Whether Zcash stabilizes or continues lower now depends less on sentiment — and more on how price reacts around a few critical technical levels.
Bear-Flag Breakdown Signals Deeper Risk
On the daily timeframe, Zcash confirmed a bear-flag breakdown on January 16, when price decisively lost the $414 support zone. This move marked the end of the prior consolidation range and validated a bearish continuation structure.
Using classical technical projection — measuring the height of the consolidation range and extending it from the breakdown point — the structure implies a downside target near $266, representing a potential 35% decline from the breakdown area.
Importantly, this is no longer a purely theoretical scenario. Price has already followed the projected path closely, confirming that sellers remain in control of the dominant trend.
Yet despite this bearish setup, ZEC has not experienced a sharp, straight-line collapse. To understand why, we need to look beyond price alone.
Capital Flow Improves as Whales Accumulate
After printing a local low on January 25, Zcash rebounded approximately 9%, coinciding with a noticeable shift in Chaikin Money Flow (CMF).
CMF combines price and volume to track whether capital is flowing into or out of an asset. Recently, ZEC’s CMF broke above a descending trendline that had suppressed it for weeks — signaling improving capital inflows.
That said, CMF remains below the zero line, meaning accumulation exists, but not at a scale strong enough to reverse the broader bearish structure. Historically, ZEC only produced sustained rallies once CMF reclaimed and held above zero. A prior zero-line reclaim preceded a 31% upside move, highlighting its importance.
On-chain data reinforces this interpretation. Over the past 24 hours:
Whale addresses increased holdings by approximately 5.96%
Mega-whale addresses expanded exposure by roughly 1.39%
This accumulation likely explains the improving CMF and suggests that large players are willing to absorb supply during weakness.
Retail Continues to Sell Rallies
In contrast, retail behavior remains defensive.
Spot flow data shows that following the recent bounce, net inflows returned to exchanges, with nearly $9 million in selling pressure appearing as price rebounded. This indicates that many participants are using short-term strength as an opportunity to reduce exposure rather than initiate new positions.
This divergence explains the mixed signals across indicators:
Whales support price at the margin
Retail sells into rebounds
As a result, ZEC remains caught between accumulation and distribution.
MFI Confirms Dip Buying — But Structure Still Dominates
The Money Flow Index (MFI) adds another layer of insight.
Between January 14 and January 25, Zcash price made lower lows, while MFI trended higher — forming a bullish divergence. This signals that dip buying has persisted even as price declined, likely driven by larger participants rather than retail.
However, momentum indicators alone cannot override structural breakdowns indefinitely. At this stage, price levels matter more than indicators.
Key Levels That Will Decide Zcash’s Next Move
$326: Critical downside support. A clean break below this level could accelerate the move toward $266, with $250 becoming a secondary downside risk if selling pressure intensifies.
$402: First major resistance. This level must be reclaimed to weaken the bearish narrative.
$449: Structural invalidation zone. A decisive move above this area would significantly reduce the relevance of the breakdown projection and shift market bias.
Until then, the dominant trend remains fragile, and any bounce without a structural reclaim risks being corrective rather than impulsive.
Bottom Line
Zcash remains technically vulnerable, with a confirmed breakdown structure still pointing lower. While whale accumulation and improving money flow suggest growing interest at discounted levels, retail conviction remains weak, and rallies continue to attract sellers.
For now, structure sets the rules — and unless key resistance zones are reclaimed, downside risk remains firmly in play.
This article is for informational and educational purposes only and does not constitute financial or investment advice. Readers should conduct their own research and assume full responsibility for any investment decisions.
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