Key takeaways:
Zcash (ZEC) has surged more than 520% in the past month, even defying the broader cryptocurrency sell-off that wiped out $20 billion of leveraged positions over the weekend.
The privacy coin’s rally has put it within striking distance of the $300 level, a price not seen since December 2021, placing ZEC among the market’s outperformers.
Can the price of ZEC rise further from its current levels, or is the slowdown overdue?
ZEC technical indicators point to another 25% rise.
Zcash’s explosive uptrend appears to be consolidating within a classic bull flag pattern, a continuation setup that typically precedes another rally.
The last candle on the 4-hour chart formed a dangerous doji near the upper trend line resistance, indicating a potential short-term pullback towards the lower border of the flag around $237.
ZEC could confirm an upward breakout if buyers push the price above the flag’s upper trend line. Such a move would set a technical price target for October near $336, about 25% higher than current levels.
The setup is also in line with healthy consolidation above the 20-period (green) and 50-period (red) exponential moving averages (EMA), suggesting that broader bullish momentum remains intact despite signs of short-term exhaustion.
The bearish scenario includes a ZEC price of $210
ZEC price falling between the two supports, i.e. the lower trend line of the flag and the 20-period moving average, increases the odds of a decline towards the 50-period moving average at around $210.75 in October.
About $5.36 million of cumulative long liquidations stacked up near the $244 level make it a major risk area for the bulls, as the chart below for CoinGlass shows.
A ZEC drop below the $244 threshold triggers a series of prolonged forced liquidations, deepening the decline ahead of any potential recovery.
In simple terms, this is where many traders’ stop-loss or filter points are waiting to be triggered, which could send ZEC prices towards the $210.75 target shown above.
ZEC hits record ‘overbought’ levels
The bearish case also depends on Zcash reaching extreme overbought levels on the weekly chart, which could lead to a short-term pullback in the coming weeks.
As of Monday, ZEC’s weekly relative strength index (RSI) stood above 92, an all-time high.
The previous peak of the RSI was 78 in April 2021, and the price of ZEC fell by about 70% over the next few months.
A similar cooling phase could follow, especially if the price fails to establish strong support near the 0.786 Fibonacci retracement level at $245.
On the other hand, a bounce from the $245 support could see the price rise towards $307 or higher, to retest ZEC’s 2021 high at around $375.
Related to: EU bans anonymous cryptocurrency accounts and privacy coins by 2027
Altcoin Analyst Sherpa He said Any decline towards $200 could be a ‘buy’, indicating that these lower levels could form a bottom over the next few days.
“I would be interested in about $230 or less if that happened,” he added.
This article does not contain investment advice or recommendations. Every investment and trading move involves risks, and readers should conduct their own research when making a decision.
The post Can Zcash Rally Sustain as ZEC Price Rises 520% in a Month? first appeared on Investorempires.com.
