In finance, a dead cat bounce is a short-lived recovery after a prolonged bear run. It is usually followed by a continuation of the bearish trend. The crypto market has seen a good number of them in 2018, but the overall trend has continued to be bearish. Today, the market has recovered again, and most coins are up by over 10%. Zcash (ZEC) is among the top gainers today and is up by over 16%. Can this sustain or will there be another reversal that could drive the price to new lows?
To make an objective analysis of this upswing, it is best to pay key attention to technical analysis, both for Zcash (ZEC) and Bitcoin (BTC). That’s because Bitcoin (BTC) is the main market driver in crypto.
Bitcoin (BTC) has shot up in the past 12 hours and hit a high of $4280. However, it is noteworthy that this pump has pushed bitcoin (BTC) to a resistance level on the 200-day Moving Average, and it is struggling at this level. If bitcoin (BTC) fails to hold above this price range, then there is a high probability that this could be a dead cat bounce. However, if it bounces above it, then there is a high probability that Bitcoin could be on the path to recovery, and by extension pull the whole market with it.
Moving on to Zcash (ZEC), today’s market pump has taken it right to a resistance area at $77.27. Depending on the market momentum, if Zcash (ZEC) pushes this level, and bitcoin (BTC) does the same, then there would be a high probability of Zcash gaining more momentum to the upside and could mark the beginning of an early Bull Run for Zcash. However, if bitcoin (BTC) fails to hold above $4250- $4300 and Zcash (ZEC) fails to hold above $77.27, it could mean that this was possibly a dead cat bounce and that the market could be headed lower.
Whatever the case, these are short-term projections. Long-term, Zcash (ZEC) is headed higher. The demand for privacy coins, both at the retail and institutional levels is on a growth path. Major companies like JP Morgan are already using Zcash privacy technology. Given that Zcash has one of the best privacy technologies in the market, its value in the market will continue to grow going into the future as the market for privacy coins grows. Zcash stands a good a chance to be the technology behind most of the privacy needs of the finance industry.
Most important of all, Zcash has a very low regulatory risk. One of the biggest dangers to privacy coins is the threat of government regulations that could greatly hinder their growth. Zcash (ZEC) has a low regulatory risk because it allows for the sending of money to non-private wallets. This aspect of Zcash will play a major role in its growth going into the future. All these fundamentals make it a low-risk crypto at its current prices. ZCash (ZEC) stands in a good position to hit thousands of dollar a coin in coming years.