Hits $700 and 'Falters'... Zcash's Fate to be Decided at $550-$575 Support Line

▲ Zcash (ZEC)/ChatGPT generated image

While Zcash (ZEC) is showing explosive upward momentum, analysis suggests it has greater volatility and instability than Hyperliquid (HYPE) due to its chart structure. After ending a long consolidation phase in the $200-$300 range, the price initiated an almost vertical rally to around $700, but the rapid pace of ascent has also increased the risk of a correction.

U.Today analyzed on May 23 (local time) that Zcash technically maintains a bullish trend. The price is significantly above all major moving averages, and the moving averages themselves are all pointing upwards. The 100-day and 200-day moving averages are significantly below the current price, and the 50-day moving average is acting as dynamic support in the early $500s.

However, instability was observed in the candle structure. A quick reversal appeared near the peak, and repeated long upper wicks indicated that traders were actively taking profits in the upward phase. Unlike Hyperliquid, which showed a relatively smooth, stair-step ascent structure, Zcash is closer to a pattern of repeated strong, explosive movements. In such a structure, corrections often occur sharply when momentum cools down.

Trading volume also indicated a high level of speculative participation. After breaking past the previous April high, trading activity significantly increased, and this trend created the current surge. The Relative Strength Index (RSI) is not as high as it was at the previous peak before November, but it remains in the overbought territory.

The biggest challenge for Zcash's bullish case is sustainability. While a parabolic rally can last longer than expected, it requires periods of consolidation to maintain a healthy upward trend. Zcash is currently significantly above its medium-term moving averages, leading to analysis suggesting that even a typical correction could result in a 15-25% drop without damaging the broader trend.

The current support range is presented as between $550 and $575. Stronger structural support lies near the early $500s, where the faster moving averages are located. If buying pressure holds these levels, Zcash can continue its ascent towards the previous cycle high. However, as most of the recent gains were made in a short period, the chart could rapidly reverse if momentum sharply declines.

Based on the chart, Zcash maintains an overall bullish trend. However, U.Today assessed that among the three assets presented, Zcash is most likely to experience the most intense volatility.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*