The Zcash worth remained regular close to its highest level this week, persevering with to obtain bids regardless of the current downturn within the cryptocurrency market.
Abstract
- Zcash held regular regardless of the broader crypto selloff and heavy liquidations sparked by new Trump-era tariffs.
- The coin’s resilience follows a brief squeeze triggered by Grayscale’s plans for a Zcash fund and a wider rally in privateness tokens.
- However with leverage hovering, funding charges at document highs, and technical indicators flashing excessive overbought indicators, analysts warn the transfer might quickly reverse — doubtlessly sending ZEC again towards $100.
The Zcash (ZEC) token was buying and selling round $274 finally test, down barely from this week’s excessive of $280.
ZEC worth short-squeeze began final week when Grayscale introduced plans for a brand new fund monitoring the coin. Whereas Grayscale didn’t point out it, the corporate is prone to file to transform it into an exchange-traded fund if it sees elevated demand. It additionally jumped as privateness cash like Sprint, Horizen, and Monero soared.
Like different cash, Zcash worth crashed to $210 as buyers panicked and bought following President Donald Trump’s new tariffs. This crash resulted in over $95 million in liquidations as exchanges closed their lengthy positions.
Nonetheless, there’s a chance that the coin will pull again for a number of causes. First, the weighted funding price has gone parabolic and hit its all-time excessive. Bullish sentiment seems to prevail, as longs pay shorts to keep up their stability.
The surging funding price can also be an indication that many merchants are utilizing leverage to go lengthy. Whereas a rising funding price is a bullish signal, an excessive one places the coin vulnerable to a plunge as a result of market’s overcrowded nature. It’s also an indication of euphoria within the crypto market.
Zcash worth has turn out to be overbought
Another excuse the Zcash worth might crash quickly is that it has turn out to be extremely overbought. The Relative Power Index has moved to the acute degree of 82, whereas the Stochastic Oscillator has moved to over 89. Property usually plunge once they turn out to be extremely overbought.
Most significantly, the coin is now within the markup part of the Wyckoff Principle. This part is adopted by distribution after which markdown, the place buyers promote their belongings to guide earnings.
Subsequently, if this occurs, the ZEC worth is prone to expertise a robust reversal within the close to time period. If this occurs, it might crash to the essential assist at $100, which is about 60% beneath the present degree.
