Zcash Price Forecast: NU7 upgrade boosts breakout hopes as ZEC withstands crypto market sell-off

• A 2% gain on Friday keeps Zcash above $1,300, as bulls look to regain the $1,340 level.
• Payments will become 3x faster and v4 transactions will be disabled when Zcash’s Network Upgrade 7 goes live as scheduled on Friday.
• Despite roughly $11 million leaving a ZEC-focused ETF on Thursday, derivatives figures indicate a substantial build-up of leveraged positions.

More than $1 billion in liquidations hit the broader cryptocurrency market the previous day, yet Zcash (ZEC) remains resilient above $1,300 on Friday, bucking the wider sell-off. Its strength coincides with the scheduled launch of Network Upgrade 7 (NU7) on Friday, bringing faster payments and disabling older transaction pools.

Nearly $11 million was withdrawn from Grayscale’s ZEC-focused exchange-traded fund (ETF) on Thursday, pointing to selling pressure from institutional investors. Elevated open interest, however, indicates a substantial build-up of leveraged positions. For the bullish trend to resume, Zcash needs to confirm a technical breakout above horizontal resistance at $1,340.

Zcash derivatives demand counters ETF withdrawals ahead of the network upgrade

Despite unsettled daily ETF flows, demand for Zcash in the derivatives market remains firm. Figures from SoSoValue put Thursday’s outflows from Grayscale’s ZEC-focused ETF (ZCSH) at $10.99 million, taking net withdrawals for the week so far to $14.77 million. The negative flows indicate that investors are redeeming ETF shares, suggesting weaker appetite for crypto against a backdrop of wider market uncertainty. 

Should Friday bring outflows or only modest inflows, ZCSH could end its run of two consecutive weeks of positive flows, putting pressure on the privacy coin’s medium- to long-term prospects. 

Derivatives figures, by contrast, suggest that Zcash is attracting greater interest from traders. CoinGlass reports that Zcash open interest (OI) has increased from 2.05 million ZEC the previous day to 2.15 million ZEC. Positioning has therefore returned to elevated levels following a modest contraction that coincided with the day of $1 billion in liquidations. 

The attraction of Zcash to leveraged traders coincides with Friday’s scheduled NU7 upgrade, which is due to activate at block height 3,543,405. By cutting block confirmation times from 75 seconds to 25 seconds, the upgrade will make payments 3x faster. Alongside disabling older v4 Sprout-shielded transaction pools to improve network security, it will introduce a Network Sustainability Mechanism (NSM). This will temporarily divert 60% of transaction fees out of circulation and into a long-term NSM Value Balance, with the aim of sustaining miner rewards as the base subsidy halves over time.

Technical outlook: Zcash tests resistance ahead of a potential bullish breakout

At $1,308 at the time of writing on Friday, Zcash is testing resistance near $1,340, marked by the 8 October high. The technical picture places the privacy coin within a consolidation range, underpinned by support around $1,112 at the 8 October low.

The underlying trend structure nevertheless remains supportive, with a positive near-term bias: ZEC is above its 50-day exponential moving average (EMA) of $1,216, itself comfortably above the 200-day EMA at $856. Confirmation of a break above $1,340 could open the way to the 26 September peak of $1,698, representing potential gains of over 25%.

On the daily chart, a Relative Strength Index (RSI) reading of around 55 and Moving Average Convergence Divergence (MACD) above its signal line indicate mildly positive momentum, suggesting that bullish pressure persists.

Any pullback would first bring the 50-day EMA near $1,216 into focus as initial support. That average is underpinning the latest move higher and would be the first significant level to face a test. A sharper decline would put the $1,112 support floor at risk.

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