Zcash recovers above $240 but risks still remain

Zcash (ZEC) continues its recovery trend and trades above $240 at the time of writing on Friday, amid broader crypto market rebounds following a week of significant volatility. Compared to the intraday low of around $185, ZEC has increased by over 31%. However, traders should remain cautious as the derivatives market shows signs of prolonged weakness.

Zcash’s upward momentum occurs alongside a decline in open interest in the futures market. ZEC open interest has fallen to approximately $335 million, down from $396 million the previous day. This persistent downward trend, especially compared to the record high of $1.38 billion in November, indicates that trader confidence in sustaining the bullish trend remains fragile. To reinforce the positive scenario, open interest needs to rise again along with the price, opening the possibility of testing the $300 supply zone.

Liquidation pressure has eased as prices recover. According to CoinGlass, about $3.2 million in long positions and $2.4 million in short positions were liquidated on Friday, significantly lower than the previous day. If the upward momentum continues, the risk for long positions could further decrease, supporting a short-term recovery trend.

From a technical perspective, ZEC is oscillating above $240 after a sharp decline of over 40% since the end of last week and 65% since the beginning of the year. The daily RSI index has risen to around 32, indicating weakening bearish momentum. However, the MACD remains below the signal line, suggesting that the bullish trend has not yet been confirmed. Key levels to watch are the 200-day EMA around $302 and the descending trendline above.

In the short term, the $230–$240 zone may absorb profit-taking pressure, while the $185 demand zone remains a risk scenario if ZEC cannot sustain its rebound and fails to regain the 200-day EMA as support.