Zcash climbs as $1.6B floods Ironwood: is a bigger ZEC breakout coming?

Zcash has risen 2.8% over the past 24 hours to trade near $509 on August 18, extending its seven-day gain to 3.4% as the migration to the Ironwood shielded pool picks up pace.

CoinGecko data showed ZEC climbing from around $495 during the past day before briefly reaching $520, with the token holding most of the initial advance and trading above $500 at the time of writing.

The latest gains come as users continue moving ZEC into Ironwood, the shielded pool introduced through Zcash's NU6.3 network upgrade. 

The migration has moved around $260 million worth of ZEC into the new pool, which has overtaken the older Sapling pool.

Ironwood was activated on July 28 at block height 3,428,143 after a critical vulnerability was discovered in Zcash's Orchard shielded pool. 

According to Shielded Labs, security researcher Taylor Hornby found the flaw on May 29, and the Zcash Open Development Lab coordinated an emergency response that fixed the vulnerability by June 2.

The vulnerability could have allowed an attacker to create counterfeit ZEC inside Orchard without detection. 

Shielded Labs said it considered exploitation unlikely, but Orchard's privacy design meant users could not independently prove that counterfeit coins had never been created.

Ironwood was built to remove that uncertainty. The upgrade sealed the old Orchard pool to new deposits and internal transactions, while funds can leave through Zcash's existing turnstile mechanism. 

The system prevents more ZEC from leaving Orchard than legitimately entered it, allowing users to independently verify the integrity of the circulating supply.

At the same time, the new Ironwood pool uses the corrected Orchard circuit alongside additional security work, including independent audits and formal verification. 

The upgrade also introduced quantum-recoverable notes under ZIP 2005.

The security issue had previously caused a sharp repricing of ZEC. ZEC lost more than 50% after the Orchard bug was disclosed, while the token was trading near $475 when Ironwood activated in late July.

Recent price action has since brought ZEC back above $500. The latest advance follows a pullback from above $500 last week, making the Aug. 18 move partly a recovery from the previous decline.

ZEC price analysis

On the daily ZEC/USDT chart, ZEC was trading around $509 at the time of analysis, with the Volume Profile Visible Range showing a large concentration of historical trading activity around the $400 to $420 area.

ZEC/UST 1-day price chart. Source: TradingView.

That zone has acted as an important support area during recent price swings. ZEC bounced from around $400 in late June before reaching approximately $570 in July, while subsequent selling has so far remained well above the same area.

The daily Supertrend adds another level to watch. Its support currently sits around $447, leaving ZEC above the indicator despite the pullback from July's high. 

As long as price remains above the Supertrend, the indicator continues to favour the existing bullish daily structure.

On the upside, ZEC first needs to clear the $516 to $520 area, where the latest intraday rally stalled. 

A sustained move above that region would put the July resistance zone around $560 to $580 back in focus.

Failure to hold above $500 would instead bring the $480 area into play before the daily Supertrend support near $447. 

Below there, the high-volume region around $400 to $420 becomes the next major area visible on the daily chart.

The 4-hour chart shows a more cautious short-term setup. ZEC was trading around $509, while session VWAP stood near $511.59 and its upper band was around $513.11.

See below:

ZEC/USDT 4-hour price chart. Source: TradingView.

Price sitting just below VWAP means buyers have yet to establish control above the session's average traded price.

Momentum has also started to ease after the latest jump.

The 4-hour Stochastic RSI showed the %K line around 77.85 and the %D line near 87.50, with %K dropping below %D after both had moved into the overbought region.

For another leg higher, ZEC would need to reclaim the $511 to $513 VWAP area and then break $520. 

Holding above $520 would open a path towards $540, followed by the $560 to $580 resistance region visible from the previous July advance.

On the downside, losing $500 would weaken the immediate setup and expose $480, while a deeper decline would put the daily Supertrend near $447 back into focus.