ZEC encounters a critical resistance: is a breakout above $500 a realistic prospect?

Zcash (ZEC) shows mixed technical signals after a recent rally of over 40% from the $300 levels. Analysts are divided – bulls believing in resistance up to $500 and bears warning of the formation of a bearish top.

Unresolved Technical Play: Between Potential and Risk

The current Zcash price oscillating around $396.55 in recent sessions indicates the instrument is hanging between two significant support lines. Structurally, ZEC must overcome many obstacles before reaching the psychological levels of previous cycles. The 200 (four-hour) EMA moving average acts as a close resistance, above which it becomes difficult for the instrument to penetrate further towards the peak.

On-chain data shows that institutional capital accumulation is a key factor supporting the bullish scenario. Whale accounts (with holdings from $100,000 to $10 million) increased their stakes by over $100 million recently, while small traders reduced their exposure by $30 million. This divergence may suggest that larger capital is expecting further gains.

Double Bottom Formation – Foundation or Trap?

Analysts point to a double bottom formation in the $300–310 range as a turning point for Zcash. If this structure confirms with a breakout above the neckline at $380, the theoretical target could extend to $480–$500. This zone coincides with the previous supply zone where ZEC faced resistance.

However, it is important to remember that a resistance breakout requires confirmation through volume and sustained movement above key levels. Past attempts to break through have been fragmented and weak in terms of buyer engagement.

Bearish Scenario Gaining Strength

At the same time, ZEC has developed within a classic bearish head-and-shoulders pattern – a falling flag channel. The decline in the last session suggests a return of control to sellers, who are defending the upper trendline of the flag.

The RSI indicator has already crossed above the 70 (overbought) level, which historically signals a weakening of bullish momentum. The accumulation of these signals warns that breaking the bearish flag could pull ZEC toward $260–$280 – about 35% below current levels.

Outlook for the Coming Days

ZEC is at a crossroads. Holding above $380 maintains the chance of reaching $500, but breaking this support opens the door to a sharp correction. Market decisions will depend on whether institutional investors can break through resistance at higher levels or if retail participants will win the battle for the price direction in the coming days.