Zcash Price Predictions 2018
The number of cryptocurrencies has skyrocketed, and the enthusiasm for them has grown in lockstep. Their performance is why people are clamoring for this sector, and as long as Bitcoin continues to perform well by forging new highs, this paradigm will persist. Given this persistent bullish backdrop that has been created, I have begun to scour the cryptocurrency universe in order to find assets that have compelling price charts. Zcash (ZEC) is one of them.
As a technical analyst, I use price charts to determine whether an asset or asset class is set to appreciate or depreciate. This is fortunate because cryptocurrencies have no fundamentals to base valuations on, so the only way to determine what Zcash might be worth is to do a Zcash price analysis.
The Zcash to USD exchange rate is currently trading at around $248.80. To put this into context, it was as low as $26.30 in February of this year and as high as $2,600 in October 2016, following its initial coin offering (ICO). This immense amount of volatility is a characteristic shared among most, if not all, cryptocurrencies. Volatility works in both directions, both up and down, but it is the moves to the upside that has the masses interested.
Volatility is not the only thing shared by all cryptocurrencies, and before I begin my cash price predictions 2018, I need to reiterate that for those who are paranoid, like myself, the best place to store your cryptocurrencies like Zcash is in a hardware Zcash wallet. This is because cryptocurrencies can be stolen and there is no recourse in getting them back if such an event does occur.
Zcash Technical Analysis
I have highlighted the constructive price action and a very influential momentum indicator on the following Zcash price chart. These indications will act as triggers suggesting that higher prices are in development.
Chart courtesy of TradingView.com
I have highlighted the constructive price action on the Zcash price chart because this alternating wave structure of impulse waves and consolidation waves creates the necessary building blocks to sustain a trend.
The wave highlighted in green is the impulse wave and it defines the stage in a bullish trend where the price of the asset accelerates significantly to the upside.
The wave highlighted in purple is the consolidation wave and it follows an impulse wave. This wave defines the stage in a bullish trend where the price refrains from advancing and the corrective price action unwinds any overbought conditions that were created during the impulse wave that preceded it.
In my analysis, I tend to focus much of my attention on consolidation waves because a consolidation wave is a precursor to an impulse wave, which is the wave that captures all the gains in a bullish trend.
The consolidation pattern currently in development has a defined level of support at $145.00 and a defined level of resistance at $435.00. A break above resistance will suggest higher prices are on the horizon, while a break below support will suggest that lower prices are in order.
I will be taking my cues from the moving average convergence/divergence (MACD) indicator, which is highlighted in the lower panel of the price chart. This very influential momentum indicator is used to determine whether bullish or bearish momentum is influencing the asset’s price. The reason why the MACD indicator is so influential is that in order to stage and sustain an advance or decline, the appropriate momentum is required.
This distinction between bullish and bearish momentum is made using the crossing of a signal line. It has the uncanny ability to reinforce whether an impulse wave or a consolidation wave is in development.
For instance, in July, a bearish MACD was generated, indicating that bearish momentum was influencing the trading action in Zcash, which implied that lower asset prices were in development. This indication coincided and confirmed the notion that a consolidation was in development.
The MACD signal lines are currently converging, so a potential bullish MACD cross in on the horizon. In order to generate a bullish cross, higher prices are currently needed. Therefore, this bullish signal would coincide with a break above resistance outlined by the consolidation wave. These indications will imply that an impulse wave is in development and, therefore, higher Zcash prices can be expected.
Zcash Price Analysis
Now that I have established the indications that will serve to suggest that higher Zcash prices are in development, I can take one step further and provide a Zcash price forecast.
This forecast is based on the wave structure highlighted on the price chart and it is predicated on the notion that the developing impulse wave is going to mirror the initial impulse waves in terms of height. This method is pretty straightforward but there are two ways of going about it.
The first way involves taking the linear length of the initial impulse wave, which was $408.00, and extrapolating that value from the base of the consolidation wave. This method of creating a price forecast is called a “measured move,” and it produces a Zcash future price of $554.00.
The second way involves a similar method, but instead of taking the linear length of the impulse waves, the log-based length is used. This method is called a “parabolic extension” and it creates a much larger Zcash future price of $2,100.
In most circumstances, I would use the first method, but given the current market dynamics in which I believe that a bubble is brewing, the parabolic extension objective of $2,100 is most appropriate.
Now that I have outlined a potential price objective, I could either buy Zcash when the appropriate signals are generated, or I could mine this cryptocurrency.
How to Mine Zcash
Mining involves using computing power to create, validate, and secure the network upon which the transactions of Zcash are made. This is the blockchain technology that all cryptocurrencies are based on. In return for providing the computing power to the network, the miner is rewarded with fractions of a coin.
In order to mine, the applicable software and hardware is required. Since computing power is directly related to hardware, the processing chip will determine how successful the venture into mining really is. Compatible Zcash Hash Rate GPUs can be found among a number of graphic chips. The graphics cards made by AMD and NVIDIA are very popular choices.
Since the popularity of cryptocurrencies has grown, so too has the participation of miners in the network, making mining more difficult. Miners can join Zcash pools, where multiple miners join forces for maximum results.
Words of Caution
I have and will continue to believe that cryptocurrencies are in the blow-off stage of an epic price bubble that will probably go down in the record books as one of the greatest bubbles of all time. The final blow-off stage of any bubble is where most, if not all, the gains in the market will be made. At the same time, the last stage is also the most dangerous because when the bubble finally bursts, a drastic sell-off follows.
The rate at which prices will drop will pale in comparison to their rise. When bubbles pop, the price drops at an exponential rate and much of the gains will be erased in a blink of an eye.
My best advice is to always define your level of risk and stay nimble because nobody ever lost any money taking a profit.
I believe that we are reaching the apex of this cryptocurrency bull market/bubble, and this is where the greatest gains are achieved. I am watching a number of indications on the Zcash price chart that will indicate when this asset is set to make another move towards higher prices. I outlined two potential price targets but picked the one with the most outlandish Zcash value in $2,100 because if there is indeed a bubble in the cryptocurrency market, then such an outlandish target is a plausible for a Zcash price prediction for 2018