Zcash is trying to recover the losses accumulated in November, after a sharp drop reduced its valuation by more than half.
The recent advance of 40% brought optimism to the market; however, several factors indicate that ZEC may still face difficulties in consolidating a significant recovery.
Zcash does not follow Bitcoin
The RSI shows that positive sentiment is strengthening as Zcash begins to regain ground. The indicator surpassed the neutral mark of 50.0 for the first time in nearly two weeks, signaling greater market confidence. An advance into the positive zone often indicates a trend reversal, which may favor the continuation of ZEC's rise.
However, the recent rise in RSI alone does not guarantee a full recovery. The market in general remains sensitive to macroeconomic signals, and small variations in sentiment can influence the pace of ZEC. For the current upward movement to sustain, it will be necessary to maintain buying pressure.
The correlation of Zcash with Bitcoin is currently at -0.47, reflecting a negative relationship at the moment when BTC begins to show signs of recovery. This divergence represents a risk for ZEC. Should Bitcoin continue to rise, ZEC may face resistance, as a negative correlation often limits the upside potential when the main market strengthens.
On the other hand, if Bitcoin loses strength or falls, the negative relationship may benefit ZEC by allowing the rise to continue independently. This scenario increases uncertainty, making ZEC's performance heavily dependent on Bitcoin's next move.
ZEC price seeks recovery
ZEC is trading at $439 at the time of this report, just below the main resistance at $442. The recent advance of 40.5% is significant, but it still does not compensate for the 55% drop recorded in November.
For a consistent recovery, Zcash would need to rise about 59% in the coming days, reaching $700. In the short term, a break above $442 could open up space for an advance up to $520, should this range become support.
If the negative correlation with Bitcoin becomes an obstacle, ZEC could retreat to $403 and potentially fall to $340. This would eliminate part of the recent advance and nullify the optimistic outlook.
The article Zcash needs to rise 59% for complete recovery was first seen on BeInCrypto Brazil.
