Zcash Drops 17% After 4-Year High, Shorts Pile In—Squeeze Setup?

Zcash (ZEC) hit a four-year high just two days ago, strongly braving the wider crypto market crash that pulled most coins down. However, things haven’t been the same since. Over the past 24 hours, the ZEC price has dropped more than 17%, trimming part of its massive rally.

Even with that dip, the coin still trades 54% higher week-on-week, showing there’s plenty of action left. But a key metric has now dropped to zero, making some traders wonder if the rally is already over. That may not be the case. Technicals suggest this could just be a cooling phase — one that might set up another breakout soon.

Social Buzz Fades, but the Flag Pattern Holds Firm

Social dominance, which tracks how much Zcash is mentioned in crypto conversations, fell sharply after peaking on October 10, the same day prices topped out near $249.

As online chatter faded, the ZEC price also slipped — but that doesn’t necessarily spell the end of the move.

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ZEC’s current structure mirrors what happened in early October, when a bull flag pattern appeared before a breakout. The social dominance metric dropped sharply during that formation as well. Also, the social metric dropping to zero isn’t uncommon for Zcash. Similar levels were tested during early October, a timeframe that aligned with rising prices.

A similar flag is forming again, suggesting that this correction (parallel social metric dip) could simply be a reset inside an ongoing bullish setup. Adding to that setup, derivatives data show a potential contrarian catalyst emerging.

Short Bets Build Up — and a ZEC Price Breakout Above $255 Could Change Things

According to Binance’s 30-day liquidation map, the ZEC/USDT pair shows a heavy short bias. More than $16.4 million in short leverage has been built below current levels, compared to $5.2 million in long positions.

This means most traders are betting against Zcash — and when short interest gets crowded, even a small price rise can trigger short liquidations, forcing prices even higher. An event commonly termed “short squeeze.”

On the charts, the ZECprice trades around $223, consolidating inside a flag pattern.

A 12-hour candle close above $255 could confirm a new breakout, targeting Fibonacci extension levels at $335, $466, and $596, with an extended projection near $615 (the projected target if the ongoing flag and pole breakout holds).

However, a fall below $190 could slow momentum, while losing $156 would invalidate the bullish structure entirely.

With social chatter quiet, derivatives leaning short, and the pattern still intact, the Zcash (ZEC) price may be setting up for another surprise upside move.