ZECUSD breaks below key technical support level
ZCash/US Dollar Index (ZECUSD) Technical Analysis Report for Nov 22, 2020 | by Techniquant Editorial Team
ZECUSD ended Sunday at 68.88 losing $3.73 (-5.14%) on high volume. The bears were in full control today, moving the market lower throughout the whole session. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (ZECUSD as at Nov 22, 2020):
Sunday's trading range has been $5.31 (7.31%), that's slightly below the last trading month's daily average range of $5.76. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for ZECUSD.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. After moving higher in the prior session, the market closed lower but above the previous day's open today, forming a bearish Harami Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.
After trading down to 67.40 earlier during the day, ZEC bounced off the key technical support level at 67.54 (S1). The failure to close below the support might increase that levels significance as support going forward. Prices broke below the key technical support level at 72.02 (now R1), which is likely to act as resistance going forward. After having been unable to move above 73.00 in the prior session, ZCash ran into sellers again around the same price level today, failing to move higher than 72.71. The last time this happened on November 15th, ZECUSD actually gained 6.58% on the following trading day.
Crossing below the upper Bollinger Band, prices have lost at least some of their upward momentum in the short-term and could now be heading back down towards the mean of the Bollinger Bands at 61.82.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might accelerate should prices move above the nearby swing high at 73.00 where further buy stops could get activated. Further buying might move prices higher should the market test October's close-by high at 75.65.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Harami Candle" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for ZEC/USD. Out of 28 times, ZECUSD closed higher 60.71% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 67.86% with an average market move of 4.56%.