Zcash Price Forecast: Can the NU7 upgrade drive a breakout as ZEC bucks the crypto market sell-off?

• Bulls are targeting a recovery above the $1,340 barrier as Zcash gains 2% on Friday and stays above $1,300.
• Payments will become 3x faster and v4 transactions will be disabled when Zcash’s Network Upgrade 7 goes live, as scheduled, on Friday.
• Leveraged positions are building up firmly, according to derivatives data, even as a ZEC-focused ETF registered roughly $11 million in outflows on Thursday.

Despite a broader cryptocurrency sell-off that triggered over $1 billion in liquidations the previous day, Zcash (ZEC) remains resilient above $1,300 on Friday. Its relative strength coincides with the scheduled Friday rollout of Network Upgrade 7 (NU7), which enables quicker payments and disables older transaction pools.

Institutional selling pressure is indicated by nearly $11 million in outflows from Grayscale’s ZEC-focused Exchange-Traded Fund (ETF) on Thursday. Elevated Open Interest, however, signals a firm accumulation of leveraged positions. A confirmed break above the horizontal resistance at $1,340 remains necessary for Zcash to re-establish a bullish trend.

Can Zcash derivatives demand counter ETF outflows ahead of the Network Upgrade?

Uncertainty around daily ETF flows has not weakened demand for Zcash derivatives. According to SoSoValue data, Thursday’s outflows from Grayscale’s ZEC-focused ETF (ZCSH) amounted to $10.99 million, taking weekly net outflows so far to $14.77 million. The negative flows indicate redemptions of ETF shares, suggesting softer investor demand for crypto against a backdrop of wider market uncertainty. 

ZCSH could end its run of two consecutive weeks of positive inflows if Friday’s flows are negative or only modestly positive. Such an outcome could weigh on the privacy coin’s medium- to long-term prospects. 

By contrast, derivatives figures indicate that Zcash is attracting greater trader interest. CoinGlass data puts Zcash Open Interest (OI) at 2.15 million ZEC, compared with 2.05 million the day before. This suggests positions have returned to elevated levels following a modest contraction that coincided with the day of $1 billion in liquidations. 

The increased appetite for leveraged Zcash positions coincides with Friday’s scheduled NU7 upgrade, due to activate at block height 3,543,405. By cutting block confirmation time to 25 seconds from 75 seconds, the upgrade will enable 3x faster payments. Network security will also be strengthened by disabling older v4 Sprout-shielded transaction pools. In addition, a Network Sustainability Mechanism (NSM) will temporarily divert 60% of transaction fees out of circulation into a long-term NSM Value Balance. This is intended to sustain miner rewards as the base subsidy halves over time.

Technical outlook: Can Zcash confirm a bullish breakout?

The $1,340 resistance established by the 8 October high is being tested as Zcash trades at $1,308 at the time of writing on Friday. The technical picture remains one of consolidation, with the 8 October low near $1,112 marking the lower support boundary.

The underlying trend structure nevertheless remains supportive: ZEC is above its 50-day Exponential Moving Average (EMA) of $1,216, which in turn is comfortably above the 200-day EMA at $856. This arrangement suggests a constructive near-term bias. If a breakout above $1,340 is confirmed, the next potential target would be the 26 September peak of $1,698, offering upside potential of over 25%.

Daily momentum indicators also retain a modestly positive tone. The Relative Strength Index (RSI) is near 55, while the Moving Average Convergence Divergence (MACD) remains above its signal line, indicating that bullish pressure persists.

Any pullback would first bring the 50-day EMA near $1,216 into focus as notable support. This level is underpinning the latest upward move; a more pronounced decline would put the $1,112 support floor at risk of a test.

(The technical analysis of this story was written with the help of an AI tool. Know more.)