Why Smart Money Is Betting on Zcash Amidst a 55% Price Correction!

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Zcash Price Corrects 55% in 2026 While Smart Money Quietly Adds, but Why?

Zcash (ZEC) is currently trading around $226. Its price has been falling since late December, stuck within a downward trend that has caused it to lose 55% of its value so far this year.

This privacy coin has repeatedly tested a key resistance level over the last week without successfully surpassing it. A bearish pattern is emerging, with traders starting to bet against it again. Interestingly, some investors are buying, while others are selling.

A Bearish Channel Meets a Bullish Divergence for the Second Time

Looking at ZEC on Binance, the price has been moving downwards in a channel since the end of December. It’s currently bouncing between support around $184 and resistance that has stopped it from going higher several times recently.

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Despite recent price declines, a positive signal is appearing on the chart. From January 10th to March 22nd, the price of Zcash fell to a new low, but the Relative Strength Index (RSI), which measures how quickly prices are changing, actually increased during that same period. This suggests potential for a price recovery. The RSI is currently at 47.11.

We’ve seen this pattern before. A similar situation occurred between January 10th and March 12th. Following that, ZEC’s price increased by about 43%, reaching a key resistance level for the first time.

The difference between a knock and a break is what the derivatives and flow data help determine.

Shorts Build Again, but Big Money Flows Are Fading

Current activity in the derivatives market looks a lot like what we saw before the recent price increase. On March 13th, there was about $212 million worth of open interest. By March 16th, when prices peaked after a 43% jump, that number had risen to around $297 million – an increase of about 40%. During this price increase, the funding rate went down from positive to near zero, indicating that most traders weren’t heavily invested in long positions. This unexpected move caught those betting against the market by surprise.

A comparable setup is currently developing. Open interest has increased by about 3%, going from $220 million on March 22nd to $227 million. The funding rate has turned negative, now at -0.003%. Traders are starting to bet against the asset again, which could lead to a rapid price increase if the price breaks through a key resistance level.

However, one critical element is weaker this time.

The Chaikin Money Flow (CMF), which measures the activity of large investors, is currently at -0.18. While the CMF was negative during the price increase in early March, this recent decline is happening more quickly.

On March 16th, the indicator tried to move above zero but didn’t succeed. Since then, it’s been generally decreasing and is now close to breaking below its upward trend. If it does break down, it would suggest that major investors are withdrawing funds, rather than providing support for the ZEC price.

Trading signals suggest potential for a price increase, with derivatives showing strength and the RSI indicating a shift in momentum. However, current market prices aren’t reflecting this optimism. This difference between the positive signals from derivatives and the weak price action is currently maintaining the existing trading range. The key question now is whether larger investors will step in to close the gap and drive prices higher.

Smart Money Adds While Zcash Price Tests Its Key Levels

The Smart Money Index (SMI) suggests a different perspective than the weakening Money Flow Index (CMF). While Zcash prices were falling between March 20th and 23rd, the SMI continued to rise and stayed above its signal line, indicating that informed traders were still accumulating the cryptocurrency.

The difference between the price going down and experienced traders increasing their investments indicates they’re buying during the dip, not selling. They seem to be predicting a breakout, even as overall investment activity slows down.

For Zcash to see significant price increases, it first needs to surpass $227, a key technical level. If it does, it could then rise roughly 18% to $267, which would set it up to potentially break through a major resistance trendline. After that, analysts are watching for potential price targets of $285, $310, and $343. If the price breaks through all of those levels, it could ultimately reach $437.

On the downside, failure to hold $227 exposes $191.

Zcash’s price is at a critical point, showing both potential for growth and weakening momentum. While sophisticated investors anticipate a price increase, it needs to stay above $227 for that to happen.

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2026-03-24 10:41