Key Points:
ZEC is extremely overbought on the chart and faces the risk of a pullback in the coming weeks.
If the parabolic uptrend continues, Zcash may still rise to the $900-$1000 range.
Zcash (ZEC) has surged approximately 1,500% in the past two months, climbing to $750—its highest level since January 2018—especially after endorsements from well-known figures in the cryptocurrency space like Naval Ravikant and Arthur Hayes.
Hayes specifically predicts that the price of ZEC will reach $1,000 by 2025, with a long-term target of $10,000. However, technical indicators show significant downside risks, and analysts warn traders to be cautious of a potential sharp price correction.
The weekly Relative Strength Index (RSI) for ZEC reached 94.24 this week, setting a new historical high.
Historically, ZEC's price tends to continue rising for several weeks after entering the overbought zone above 70, but often experiences sharp multi-month corrections of 45% to over 90% afterward.
What makes the current rise unique is its duration. The RSI for ZEC has remained above 70 since the end of September, marking the longest period of overbought conditions in Zcash's history.
Multiple analysts expect ZEC to experience a sharp correction in the coming days. Altcoin Sherpa noted that this is an "excellent shorting opportunity" that could face a "violent end."
Traders Edward Morra and DarkSide indicated in their analysis that ZEC's price could drop from the current level above $600 to $500 in November.
According to CryptoQuant's spot trading volume bubble chart, ZEC's market activity has entered the "overheated" zone, showing the most pronounced red cluster ever.
In 2021-2022, ZEC plummeted over 95% after relatively mild signals appeared.
Previous overbought corrections on the weekly chart suggest that ZEC's price is approaching its 20-week Exponential Moving Average (20-week EMA, represented by the green wave line).
As of Monday, the EMA wave line is around $230, nearly 62% lower than the current price.
On the 4-hour chart, ZEC remains within a steep parabolic channel and is currently testing a key support confluence area formed by the 20-day EMA and the lower parabolic trend line.
A successful rebound from this area could reignite bullish momentum and push the price toward the upper range of this pattern, around $900 to $1000, aligning with Hayes' earlier prediction.
Related: Arthur Hayes claims Zcash (ZEC) has become the second-largest holding in his family office after Bitcoin (BTC).
This article does not constitute any investment advice or recommendation. All investment and trading activities carry risks, and readers should conduct their own research before making decisions.
Original article: “Zcash Price Soars 1,500% in Just Two Months, ZEC May Face a 'Violent End'”
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