The price of Zcash has cooled off after a strong rally that lasted several months. Despite the token still being up over 650% in three months, the recent trend has become more cautious. ZEC has dropped by about 11% in the last seven days and has returned nearly 43% in the last month.
This retracement has raised a simple question: is it just a pause or is the bull run losing strength? The data on leverage, on-chain signals, and price levels suggest that the answer depends on one factor: whether Zcash will be able to recover the $404.
Are cautious accumulation signals returning?
Momentum indicators are sending mixed but important signals.
The Chaikin Money Flow, which monitors whether capital is entering or exiting the market, showed a slight bullish divergence between December 11 and 17. During that time, the price of Zcash recorded a lower high, while the CMF marked a slightly higher high. Usually, this indicates that buying pressure is slowly returning beneath the surface.
However, the CMF remains below the zero line. This is important. A value below zero indicates that the overall net capital flow remains negative. Buyers are present but remain cautious rather than aggressive.
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The On-Balance Volume, or OBV, tells a similar cautious story. The OBV measures whether volumes confirm price movements. In the case of Zcash, the OBV continues to move in line with the price and has not surpassed its downward trendline. No bullish divergence is emerging here.
In summary, a bit of accumulation is occurring thanks to the CMF, but there is no real continuation. It seems to be an initial positioning phase, not yet a complete trend change.
Leverage data shows a timing divergence among traders
The position on leverage helps explain why the movement is slow.
On the seven-day liquidation map, short positions dominate. Shorts amount to about 44 million dollars, while longs stand around 14 million dollars. This shows that short-term traders are still positioned for a decline. Most expect prices to drop further.
The situation changes when looking at the 30 days. Both long and short leverage are hovering around 38 million dollars. This balance suggests that long-term traders are not strongly bearish. In fact, almost half of derivative traders expect the price of Zcash to rise.
This situation reflects what has been reported by the indicators. Short-term pressure persists, but long-term bullish positioning is improving. This is why Zcash's bullish movement seems to be only postponed and not canceled.
The price levels of Zcash that decide what happens next
Now the price brings all these elements together.
The most important support is at 301 dollars in case the bearish trend prevails. This level has withstood multiple tests and represents the lower limit of the current structure. As long as Zcash remains above 301 dollars, the macro bullish trend will remain intact.
The short-term problem is 404 dollars. Zcash has failed to stay above this level and continues to trade below it. That area now serves as a point of control.
A daily close above 404 dollars would indicate that cautious buyers are gaining more confidence. From there, the next important test is near 520 dollars, a level that has acted as a ceiling to the rise since the end of November.
If $404 remains unclaimed, the bearish risk remains open. A loss of $301 would expose to an even deeper retracement risk, although the long-term trend would remain intact.
For now, the data indicates a delay, not a defeat. Zcash is waiting for confirmation. And this confirmation begins with a recovery of $404.
