Zcash price is facing new selling pressure after dropping 16% in the last 24 hours, with the altcoin falling short of attempts to rise above $400.
This rejection has delayed ZEC's attempts to recover to higher levels, and if market sentiment weakens again, the extended wait could pose additional challenges for traders.
Zcash distancing from Bitcoin
The correlation between Zcash and Bitcoin has decreased over the past few days, falling back below the correlation zero line. A negative correlation means that ZEC is no longer moving in tandem with Bitcoin price direction.
Initially, it may seem neutral, but this introduces unusual risk dynamics. If Bitcoin rises, ZEC may not benefit from broader market optimism.
Conversely, if Bitcoin experiences a sharp decline, ZEC may unexpectedly rise, but this does not guarantee sustained bullishness.
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The liquidation map adds another layer of caution for current ZEC holders. If ZEC drops below $300, long positions worth $17,490,000 are at risk of being liquidated.
Such potential liquidations represent key pressure points for bullish sentiment.
As the price approaches this threshold, continuous liquidations can accelerate the downward trend. Such events often lead traders to exit long positions and refrain from new long exposure, contributing to a feedback loop that reinforces the downward trend.
ZEC is trading at $339 and is hovering near a support level of $344 after a sharp drop from the intraday high. A sudden sell-off and weakened market structure suggest the possibility of further declines in the short term.
If the downward trend continues, ZEC could decline towards the critical support level of $300. Losing this level is likely to trigger a liquidation cluster worth $17,490,000, which could force selling pressure to push the price down to $260.
However, if momentum shifts and buyers return, ZEC may attempt to recover towards $403 after stabilizing at $344. Successfully breaking this level would invalidate the bearish thesis and restore confidence for long position traders.
