Zcash (ZEC) faces a potential 40% drop toward $680 as a bearish chart pattern develops ahead of a crucial network upgrade decision on Oct. 20.
ZEC traded near $1,140 on Oct. 19, down approximately 29% from its late-September peak near $1,600. The token remains under pressure despite expectations surrounding its upcoming NU7 upgrade.
Zcash Bearish Pattern Targets $680
Zcash’s daily chart shows a rounding-top formation followed by a narrow, upward-sloping consolidation channel resembling a bear flag.
The rounding top developed after ZEC peaked near $1,600 in late September. The subsequent decline pushed the price below its 20-day exponential moving average (EMA), currently near $1,231.
ZEC has since formed a rising channel below the 20-day EMA and the 50-day EMA near $1,181, suggesting the latest consolidation may be a temporary pause in the broader downtrend.
A breakdown below the channel’s lower trendline, near $1,100, would strengthen the bearish setup and increase the likelihood of a decline toward the 100-day EMA (purple) at approximately $1,000.
The broader rounding-top formation projects a downside target near $680, calculated by subtracting the pattern’s approximately $460 height (the distance between its $1,600 peak and $1,140 neckline) from the neckline support.
That would represent a decline of approximately 40% from current prices. However, the measured-move target requires a confirmed breakdown below the $1,140 neckline, while the 100-day EMA could provide interim support.
The daily relative strength index (RSI) stands near 43, below the neutral 50 level, indicating that bearish momentum remains intact.
Conversely, reclaiming the 50-day and 20-day EMAs would weaken the bearish outlook and could trigger a recovery toward $1,300.
Zcash NU7 Decision Scheduled for October 20
Zcash developers are expected to finalize the NU7 mainnet activation decision on Oct. 20, ahead of a tentative rollout on Nov. 5.
The upgrade proposes reducing the network’s target block time from 75 seconds to 25 seconds, allowing faster transaction confirmations.
It also introduces a Network Sustainability Mechanism that would allocate 60% of transaction fees to a reserve for future mining rewards.
Another proposed change would disable legacy version 4 transactions, potentially making funds remaining in the older Sprout shielded pool inaccessible unless moved before activation.
The upgrade could improve Zcash’s network efficiency and provide a short-term sentiment boost. However, its impact on ZEC’s price remains uncertain.
