Bitcoin Cash Price Analysis: BCH/USD at Risk of a Full Reversal After Promising Run
- The Bitcoin Cash price is unable to sustain upside momentum, as bears continue to sell any bull rallies.
- BCH/USD had breached at the time of writing a key area of support at $150. This could open the door for a retest of the $100 level and then the recent bottom at $73.50.
The Bitcoin Cash price remains firmly on the back foot, and has been cooling since the 24th December. BCH/USD had initially reached heights of $241 on the 21st but the bulls began to lose momentum within an area of supply. The instability of the price comes after such an impressive and explosive run higher. Given the sheer strength of that, many would have thought it demonstrated a similar behaviour to the crypto market 2017 bull move.
Sell the Santa Rally
On 15th December, BCH/USD managed to find its feet at an apparent bottom of $73.50. In the following session life returned to the market bulls, as the price re-entered into a trend higher. This switch in sentiment came after a brutal November – early December, where BCH/USD had dropped 88%. Between the 16th to 21st December, Bitcoin Cash demonstrated one of the strongest recoveries across the major cryptocurrencies. BCH/USD gained a whopping 218% within this period.
Looking at the recent cooling in the price over the past seven days now, this is prompting some ‘FUD’ across the market. The strong bear market of 2018 may not be over just yet, with there just being a few days left of the year. Over the mentioned period, BCH/USD has dropped around 40% from the 21st December high print. Throughout this year, the market bears have consistently sold any short-term bull rallies that have taken place.
Key Support Areas
In terms of the daily chart view, there isn’t too much in the way of strong standout support levels that are close to the current price. The next major downside area to note would be back towards the psychological $100 mark. To be specific, the 6th December low of $105 is the target. Between the 7th – 10th December, BCH/USD hovered around this price territory, before resuming its move south, to the $73.50 low on the 15th.
Sellers will likely remain in control with the price below the $150 territory. This level is key as it is a strong prior acting area of support. A bottom had temporarily formed on the 25th November here and was supporting the price right up to the 4th December. The price also managed to find some comfort here on the 25th December, before being breached in Thursday’s session and closing below.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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