Zcash (ZEC) is showing renewed strength following a sharp bounce in the last 24 hours, hinting at a repeat of a recent market pattern. This recovery could cost bearish traders $30.8 million, significantly increasing the risk for Zcash short sellers betting against the rally.
The Chaikin Money Flow (CMF) indicator is key to this movement. Although it is dipping, it remains above the zero line, which traditionally indicates that capital inflows still outweigh outflows. Historically for ZEC, whenever the CMF hovers just above zero, the altcoin experiences a rapid resurgence in inflows, driving price rebounds even before the indicator turns firmly bullish.
Furthermore, the macro momentum surrounding Zcash adds more intrigue to the scenario. A liquidation map analysis reveals a significant threat to short traders if ZEC extends its climb. Technical cues point to an imminent rise, with the next major resistance located near $600. A price move to this level would trigger approximately $30.8 million in short position liquidations.
Is Zcash About to Invalidate the Bearish Thesis?
This potential “short squeeze” creates an additional layer of pressure on bears. Historically, large-scale liquidations often amplify bullish momentum, accelerating price rallies. Zcash is up 12.6% over the last day, though it has yet to reclaim the nearly 60% gains logged at the start of the month. If ZEC manages to break above $521 and push through the $600 barrier, a direct path toward $700 could open up.
However, the bullish scenario hinges on overcoming key resistance. If the cryptocurrency fails to breach $521, the recovery outlook would weaken. In that case, Zcash could retrace toward the $441 support or even fall below $400. This would invalidate the current bullish thesis and return the asset to a broader corrective trend.
