Zcash has tumbled more than 20% from its all-time high as Grayscale's ZCSH ETF posted its first weekly outflow since late August. The coin's NU7 upgrade has moved to public testnet ahead of schedule, with a mainnet decision due October 20, while this week's price action will likely track US-Iran developments.
Zcash has dropped more than 20% from its all-time high, and the selling has coincided with a reversal in ETF demand. Grayscale's ZCSH ETF recorded about $93.6 million in net outflows in the week ending October 2, its first negative week since late August.
Geopolitics and rate-hike bets behind the outflows
Worsening geopolitical developments and Fed rate hike expectations might have driven the outflows, since most of the Zcash-specific bullish news had already been priced in.
NU7 reaches testnet ahead of schedule
Zcash activated its NU7 upgrade on public testnet on October 4, slightly ahead of the previously expected October 6 date. The upgrade cut the target block time from 75 seconds to 25 seconds and introduced a Network Sustainability Mechanism along with new limits for shielded transactions. Developers will assess the results before making the final mainnet activation call on October 20, with November 5 currently targeted for mainnet launch.
US-Iran talks the main catalyst this week
Given a light economic calendar, US-Iran developments will likely stay the main focus for Zcash this week. A breakthrough in negotiations would be positive for the token, since it would trigger a further unwinding of aggressive Fed rate hike expectations. A prolonged stalemate or a deterioration in the situation, on the other hand, could continue to weigh on risk sentiment and keep a lid on the broader crypto market.
On the daily chart, Zcash broke below its major upward trendline, with sellers targeting a drop into the 1,031 level next; a move there could draw buyers back in to position for a rally toward new highs, while a break lower would open the door to the 800.00 level. On the four-hour chart, buyers are leaning on a minor upward counter-trendline to position for a rally toward 1,500, while sellers look for a break lower to extend bearish bets into 1,031.
Source: investingLive
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