Key points:

• Zcash ( ZEC ) On Friday, the trading price was around $1,300, performing better than the broader cryptocurrency market.
• ETF, which focuses on ZEC under Grayscale, recorded a net outflow of $10.99 million on Thursday, bringing this week's total capital withdrawal to $14.77 million.
• ZEC is currently facing a direct resistance level of $1,340; if it breaks through this level, it could open the way for a rise towards $1,698. $1,216 and $1,112 remain as key support levels.

Zcash ( ZEC ) maintained a strong performance around $1,300 on Friday, outperforming major cryptocurrencies. The day before that, the broader market struggled to recover after a round of selling, which triggered liquidations worth over $1 billion.

This privacy-focused cryptocurrency was trading at around $1,290 at the time, and market expectations for its network upgrade 7 ( NU7 ) provided support for it. The upgrade plan was activated on Friday.

This upgrade will bring significant changes to the Zcash blockchain, including faster block confirmation, the retirement of the old transaction shielding pool, and a new mechanism designed to support the long-term sustainability of the network.

However, the capital flows of institutions present a different picture. The exchange-traded fund (ETF) under Grayscale that focuses on ZEC recorded a net outflow of nearly $11 million on Thursday, and the cumulative net outflow for this week has reached $14.77 million.

Despite the weak performance of ETF, there has been an increase in participation in the derivatives market, with the number of open futures contracts for Zcash rising to 2.15 million ZEC.

From a technical perspective, ZEC must break through the resistance level of $1340 in order to strengthen its bullish outlook, and there is a possibility that the rebound could extend to $1698.

Zcash strengthened against the trend by selling in the crypto market before the upgrade of NU7

Despite the overall decline in the crypto market, Zcash still exhibited relative strength.

Wider-scale selling triggered the liquidation of over $1 billion in derivatives on Thursday, prompting investors to reduce their exposure to risk-sensitive assets.

Bitcoin, Ethereum, and several major altcoins all recorded significant declines, reflecting an increase in market uncertainty.

However, ZEC is still trading around the psychological barrier of $1,300. Its resilience coincides with the increased market attention to the upgrade of the network NU7.

This upgrade plan will be activated at block height 3543405, bringing about several technical adjustments aimed at improving network efficiency and sustainability.

The upcoming activation provides a potential catalyst for traders who wish to seek opportunities in an overall downward market trend.

Despite the relatively strong token prices, the institutional demand for Zcash investment products has weakened.

According to the data from SoSoValue, the product with the theme ETF under Grayscale and the trading code ZCSH recorded a net outflow of $10.99 million on Thursday.

Zcash Technical Analysis: The $1,340 resistance level is crucial

The Zcash daily chart shows that this cryptocurrency is consolidating below an important horizontal resistance level.

Currently, the price of ZEC at around $1290 is still below the resistance level of $1340, which corresponds to the high point on October 8th. For buyers, this level has become a key obstacle to continuing the recent rebound.

If the daily close firmly exceeds $1,340, it may indicate a bullish breakout from the current consolidation range. Such a trend could attract more buying interest and shift market attention towards the high of $1,698 set on September 26.

However, the bullish scenario depends on confirming a breakout and sustained buying momentum. If the price cannot break through $1340, ZEC may continue to be confined within the current trading range.

The lower edge of this range is around $1,112, which corresponds to the low point on October 8th.

Despite the resistance above, the broader technical outlook for Zcash remains positive.

The cryptocurrency is currently trading above the 50-day exponential moving average ( EMA ), which is around $1216.

The 50-day EMA is also significantly higher than the 200-day EMA, which is around $856. This arrangement indicates that although the token is consolidating, the underlying trend still favors the buyers.

The momentum indicator also provides further support for a bullish outlook. The Relative Strength Index (RSI) on the daily chart ( RSI ) is around 53, which is above the neutral threshold of 50.

At the same time, the Moving Average Convergence Divergence indicator ( MACD ) is above the signal line, indicating that bullish momentum still exists.

Overall, these indicators suggest that if buyers successfully break through the resistance level of $1340, ZEC still has the potential to continue to rise.

Zcash The next significant price movement may depend on whether buyers can push it above $1340.

If continuous breakthroughs can be achieved, it may open up the possibility to reach the previous high of $1,698 set on September 26.

However, if ZEC fails to regain the level of $1340, traders may shift their attention to nearby support levels. The first important downward level is the 50-day EMA around $1216.

If it continues to fall below $1,216, it will weaken the short-term bullish outlook. The next major support level will be at $1,112, which is the lower edge of the current consolidation range.

If it falls below this level, it may indicate a more significant deterioration in the market structure.

For now, ZEC is still in a relatively favorable position, above the main moving averages, but the resistance at $1340 is still limiting upward momentum.