ZEC Struggling To Break Out Above Resistance (Price Analysis for ZEC: March 14)

A small dip has since followed, but prices are still much higher than before the Mar 12 spike began. Here is a look at the prices of ZEC between Mar 5 and Mar 14:

Key Highlights For Mar 14

• The price of ZEC has been on an uptrend since Mar 9.
• ZEC initiated a rapid upward move on Mar 12.
• The MACD and SMAs have triggered a buy signal.
• There are resistance areas near $54 and $60.
• There are support areas near $48 and $40.

Tracing Support

The price of ZEC on Binance is analyzed at 30-minute intervals from Mar 5 to Mar 14. The price made a low of $48.75 on Mar 5. It immediately initiated an upward move before retracing. After every market cycle, the lows have been higher than the preceding ones. Tracing these lows gives us an ascending support line.

The support line can act as a floor to price, preventing further downward movement. It theoretically traces the lower limits of price over a given period of time. Initially, the price increased at the same rate as predicted by the support line—before accelerating on Mar 12. Wick breakdowns below the support line can be considered insignificant if they are not succeeded by continuous price decreases. This was the case with the wick low of $48.20 on Mar 8 since the price immediately rebounded to above the support line. Price increases at the rate predicted by the line is predicted. Rises and dips along this upward trend should be expected as well based on past movements.

Ascending Triangle

The price of ZEC on Binance is analyzed at one-hour intervals from Feb 25 to Mar 14 in order to better visualize the creation of the resistance line. The price made a high of $54.9 on Feb 25. While it has made several downward moves since it has revisited the same level three more times. Tracing these highs gives us a horizontal resistance line. Similar to the support line, the resistance line can act as a ceiling to price, preventing further upward movement. The resistance and support lines combine to create an ascending triangle. This is a bullish pattern and suggests forthcoming prices increases as predicted by the support line. Based on this pattern, it is likely that the price of ZEC continues increasing at the rate projected by the support line while remaining within the confines of the ascending triangle. At a point of convergence between the support and resistance, ZEC is projected to break out of the resistance or breakdown below support. If price continues moving along the current upward trend, a breakout is more likely.

Signal Triggered

The moving average convergence divergence (MACD) is a trend indicator that shows the relationship between moving averages (long and short-term) and the price. It is used to measure the strength of a move. Combined with simple moving averages (SMA), MACD can be used as a trigger for buy and sell signals. Signals are triggered whenever the MACD line is above 0 and the price is above the 21 (red) and 50-period (green) SMAs. On Mar 14, the price initiated a rapid upward movement. This brought it above the 21 and 50-period moving averages. During the same interval, the MACD line crossed above 0. This would have triggered a buy signal, indicating that the current trend may be ending and that a more rapid price increase may soon begin. According to these indicators, it is likely that a new upward trend has started and the price will reach the horizontal resistance line soon.

Reversal Areas

The price of  ZEC on Binance is analyzed at six-hour intervals from Feb 2 to Mar 9 in order to better visualize possible reversal areas.

Resistance and support areas are formed when the price reaches a certain level several times. They can act as a ceiling/floor that prevents the price from moving further in that direction. The first resistance area is found near $54. The second one can be found near $60. If the price breaks out, these two will provide likely reversal areas. Based on our analysis, it is likely that the price reaches at least one of these areas.  The first support area is found near $48 while the second one is found near $45. If the price were to break down, these would provide likely reversal areas. Based on our analysis, it is unlikely that the price reaches these areas.

Summary of Analysis

Based on this analysis, the price will likely continue trading inside of the ascending triangle on an upward trend. At a certain period in the near future, it will reach support. It is possible that at this point, a breakout will occur. This is especially true if a more rapid price increases lead price to break out of the resistance. However, we believe that the price will retrace from the support before a breakout. If the price touches the horizontal resistance line, this prediction will be partially validated. A breakout at this point would also partially validate the prediction. Full validation would require the price to retrace from resistance before breaking out. When do you think the price of ZEC will break out of the triangle? Let us know in the comments below. Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.