Zcash Coin Prices Are on Their Way to $2,000
I have never been so enamored with a sector I have also had so much disdain toward at the same time. This may sound confusing, so let me explain.
This bipolar attitude is directed at the cryptocurrency sector. The logical side of my brain knows that these cryptocurrencies in their current form will not survive the test of time, so as a result, I am an obvious skeptic. At the same time, given that I am a technical analyst, I analyze the merits of an investment based on its price chart and I have to say the cryptocurrencies are impeccable in that respect. As a group, their price charts continue to suggest that there is a lot more upside left before everything is said and done.
So as a result, I am focusing on Zcash coin (ZEC) because of its price chart. I have the inclination to believe that much higher Zcash prices are on the horizon. These beliefs center around a technical price pattern that has been completed on the ZEC price chart, and it carries tremendous implications regarding the ZEC coin price going forward.
The completed technical price pattern is highlighted on the following Zcash price chart.
Chart courtesy of TradingView.com
The technical price pattern highlighted on the Zcash coin price chart is a channel. This channel is created using two parallel trend lines, which represent respective levels of price resistance and price support, which define the trading range that contained the ZEC coin price since mid-June.
Channels such as this one are resolved when the asset’s price breaks above resistance or falls below support. Such an event will determine the direction the price is heading in next.
On December 13, this channel was resolved when the Zcash coin price broke above resistance, which resided at $430.00. This completed the channel, suggesting that higher ZEC prices can now be expected to follow.
Taking the big picture approach can help determine the repercussions of this completed channel and help gauge how high Zcazh prices can venture.
The following ZEC price chart illustrates that the price action has been constructive in nature.
Chart courtesy of TradingView.com
This Zcash coin price chart has been annotated in order to highlight the waves that create constructive price action.
The wave highlighted in green is the impulse wave and it defines the stage in a bullish trend where the asset’s price sustains a move toward higher prices.
The wave highlighted in purple is the consolidation wave and it defines the stage in a bullish trend where the price corrects and refrains from making an advance. Corrective price action is a necessary stage in a bullish trend because it unwinds any overbought conditions that were created during the impulse wave that preceded it. This sets the stage so a new advancing impulse wave can follow.
The channel doubles as a consolidation wave. Its competition suggests that a new advancing impulse wave is in development and, therefore, higher Zcash coin prices are expected to follow. The notion of higher prices is being confirmed by the moving average convergence/divergence (MACD) indicator.
MACD is a momentum indicator that is used to determine whether bullish or bearish momentum is influencing the asset’s price. The information provided by this indicator is important because price cannot sustain a move toward higher prices without bullish momentum. This also means this indicator has the propensity to confirm the pattern that is in development.
In July, a bearish MACD cross was generated. This indication correctly confirmed that a conditional wave was in development and that Zcash price refrained from staging an advance.
In November, a bullish MACD cross was generated and the ZEC coin price began to stage an advance. Now, there are indications that a new impulse wave is in development.
Zcash Price Objective
OK, time to get to the meat and potatoes, which is a price objective. The great thing about constructive price action is that it can be used to generate a price objective for the impulse wave that is currently in development.
There are two ways to go about this, the linear objective and the log-based objective. For cryptocurrencies, I use the log-based objective because this asset class has a tendency to make parabolic moves.
This objective is created by taking the log-based length of the initial impulse wave and applying that length from the base of the consolation wave. This method suggests that ZEC coin prices can reach a high just north of $2,000. As outlandish as this may sound, I think it is attainable.
As much as it pains me to say it, I think cryptocurrency prices have further to run before all is said and done. The indication on the Zcash price chart suggests that the path of least resistance is geared toward higher prices. Therefore, I am bullish on the prospects of ZEC coin prices.