Zcash Faces Potential Downturn as ZEC Surges 1,500% in Two Months
ZEC's explosive rise raises concerns about a possible correction of 60% or more due to its extreme overbought conditions.
Key Insights:
- ZEC is currently in an overbought condition, which may lead to a potential price correction soon.
- Zcash’s value could still reach between $900 and $1,000 if the upward trend continues.
Zcash (ZEC) has remarkably surged around 1,500% in just two months, hitting $750 — the highest since January 2018. This spike comes alongside notable support from key figures in the cryptocurrency community, including Naval Ravikant and Arthur Hayes.
ZEC/USDT daily chart. Source: TradingView
Hayes believes that ZEC could hit $1,000 by 2025 and potentially reach $10,000 in the long run. Yet, current market indicators show considerable downside risks, suggesting that traders must be cautious of a significant price drop.
ZEC is Very Overbought
This week’s relative strength index (RSI) for ZEC soared to 94.24, indicating extreme overbought conditions. Historically, such conditions often lead to price corrections ranging from 45% to over 90% after a period above 70.
ZEC/USDT weekly chart. Source: TradingView
Analysts are now predicting a potential sharp price correction due to prolonged overbought levels. This includes comments from Altcoin Sherpa, who recently stated that ZEC is a ‘great short’ and might experience a ‘violent end.’
Traders Edward Morra and DarkSide have suggested that ZEC’s price might fall to $500 by November.
Source: X
Warnings from Market Activity
ZEC’s market activity has reportedly entered an ‘overheating’ phase, marked by the largest red cluster on record, according to CryptoQuant’s Spot Volume Bubble Map.
A similar scenario occurred in 2021-2022 when ZEC fell over 95% following a less severe warning signal.
Current overbought corrections indicate that the price is nearing its 20-week exponential moving average (EMA), which is about $230, significantly lower than current pricing.
ZEC/USDT four-hour chart. Source: TradingView
A rebound from this support level could reignite bullish trends, pushing prices towards $900 to $1,000, consistent with Hayes’ prediction.
Note: This article is not intended as investment advice. Always do your own research before making financial decisions.
