Zcash Price Prediction: Early Rejection of $520 Resistance Could Plunge ZEC

Zcash (ZEC) has dropped by 4% in the past 24 hours after rejecting a move above a key resistance at $520.

Trading volumes have not picked up yet despite this early rejection, but breaking below the $500 psychological threshold may do the trick, as the volume of stop orders sitting near that level could be high.

Macroeconomic conditions remain unfavorable for crypto assets, as the Federal Reserve is expected to hike interest rates by at least 25 basis points until the year ends to contain inflation.

Persistent geopolitical tensions in the Middle East inject a degree of uncertainty that also favors a bearish outlook in the near term.

As a result of these two factors, investors’ sentiment remains heavily depressed, as reflected by low search volumes for crypto-related terms and thin trading volumes across top altcoins.

In Zcash’s case, the token has managed to withstand some of the turmoil, including a strong hit the project took as a result of a technical weakness that flew off the radar for years.

This situation led to a strong decline for its native asset, ZEC, to $250 at some point, but investors quickly piled in and pushed it back to more than $500 just a couple of weeks after.

Launch of Ironwood Could Limit the Impact of Zcash’s Latest Exploit News

Zodl, a Zcash-focused crypto wallet, recently launched a new pool named Ironwood that aims to substitute the existing Orchard pool. The team described it as follows: “The new pool uses the existing Orchard protocol but backed by formal verification and additional independent audits.”

ZEC tokens have already started to be migrated to this new pool, as per on-chain data from ZecHub. Since the pool was launched, nearly 1.3 million ZEC have been moved to Ironwood. This is an early indication that the community is embracing the solution and moving forward.

Limiting the impact of this exploit on Zcash’s credibility is critical for the future of its native asset. The team emphasized that the consequences of this technical flaw were limited.

“There is no evidence that it was exploited, no evidence of impact to user funds, and no evidence of any change to the total ZEC supply. The issue did not affect the privacy of funds in any pool, and Orchard is live and operating normally,” a statement from Zodl reads.

ZEC Could Drop to $425 Unless Market Conditions Improve

Heading to the daily chart, we can see that the price action is once again reacting strongly to a retest of the $520 resistance.

The price closed yesterday’s session way below its highs and is currently dropping sharply. This could mark the beginning of Zcash’s next leg down, with the 200-day exponential moving average (EMA), which sits at $425, in sight as the most likely target in the near term.

The Relative Strength Index (RSI) currently sits at 47. If it drops below 40, this could trigger a sell signal that may plunge ZEC to that $425 threshold.

Market conditions favor a bearish outlook and may prevent ZEC from rising past $500 for now. However, if the tide turns, the token could once again jump above this resistance as the launch of Ironwood and the limited impact of this exploit may once again drive demand toward the project.