Zcash price has lost momentum and crashed in the past few months, moving from a high of $746 in November last year to the current $265. This crash has brought its market capitalization from over $10 billion to $4.3 billion.
Why the Zcash Price Has Crashed
Zcash, a top player in the privacy industry, has crashed in the past few months as investors continue booking profits after the recent surge. This rally pushed it from a low of $44 to a record high of $746. It is common for financial assets to pullback after experiencing a parabolic move.
ZEC price has also retreated because of the ongoing crypto market crash that has affected Bitcoin and most altcoins. The market capitalization of all coins has slumped from over $4.3 trillion last year to $2.3 trillion today. This industry is highly correlated, with Bitcoin’s retreat leading to a drop among other altcoins.
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Zcash price has also slumped because of technical factors. As we explained, the surge happened as the coin moved from the accumulation of the Wyckoff Theory to the markup. It had spent over three years in this accumulation.
The coin has now moved to the distribution and the markup phase since smart money investors have already sold. These two phases are usually characterized by intense panic selling among retail investors. This explains why the futures open interest has dropped to $400 million from last year’s high of over $1.38 billion.
At the same time, competition in the privacy industry is expected to keep rising in the near term. For example, Cardano is working on Midnight, a sidechain focused on privacy leveraging the zero-knowledge (ZK) technology.
Also, Ethereum plans to implement a major upgrade later this year that will introduce stealth addresses. This is important as ETH is one of the most commonly used tokens in the crypto industry.
ZEC Price Prediction: Technical Analysis
Zcash price chart | Source: TradingView
The daily chart shows that the ZEC price has slumped in the past few months. It has crashed from a high of $746 to the current $265. It remains below the key support level at $302, its lowest level in December last year.
Zcash price has remained below the 50-day and 100-day Exponential Moving Averages (EMA). Also, the Relative Strength Index (RSI) has moved from the neutral point at 50 to the current 35.
Therefore, the most likely scenario is where the coin continues falling, potentially to the key support level at $185, its lowest level this month.
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