Bitcoin Cash Price Analysis: BCH/USD Runs into Heavy Sellers, Despite Poloniex Launching Pre-Fork Trading

 

  • Poloniex exchange listed options to buy Bitcoin Cash ABC (BCHABC) and Bitcoin Cash SV (BCHSV) trading tokens.
  • BCH/USD runs into trouble after entering chunky supply area; price being forced to retreat. 

Poloniex Pre-Fork Bitcoin Cash Trading

Poloniex has announced that it would be the first exchange that will offer trading for the imminent Bitcoin Cash (BCH) hard fork. The exchange earlier in the year was acquired by Goldman Sachs-backed start up Circle for $400 million.

It was detailed by the exchange that commencing from Wednesday evening, it has begun to offer customers the option to buy Bitcoin Cash ABC (BCHABC) and Bitcoin Cash SV (BCHSV) trading tokens. It is noted however on their website “deposits and withdrawals will be enabled after the fork happens and the network is stable.”

Poloniex has never made such an offering prior to a possible fork. It explained that this is part of a larger strategy, as detailed in their most recent blog post. “We’re doing this to empower customers to demonstrate their support for one coin over the other through trading activity. Poloniex will also support trading markets for both tokens after the hard fork.”

Technical Review – BCH/USD

BCH/USD daily chart

BCH/USD ran into some trouble yesterday, after seeing a chunky rejection within a known heavy area of supply. A firm daily closure in the red was observed, and this has continued in trading today, nursing further losses. As of the time of writing, BCH/USD now over the course of the past two sessions is nursing double-digit losses.

The supply zone is seen tracking from around $635 up to $660, as firmly demonstrated between 2-4 September. This was the last time BCH/USD traded in this territory, which led to a chunky sell-off. Bitcoin Cash went on to drop over 35%, after trading within the mentioned supply. Falling to lows of around $410. At the time, this was the lowest price print seen since October 2017.

Support Areas

Given the current downside momentum, it is worth looking at the next areas of support to catch the falling price. Firstly, the psychological $500 mark will be eyed, around this level for a potential safety net. Should this fail to hold, then as seen between the above-mentioned period, 2-4 September, the bottom of $410, could come back into play.

Due to the excessively large rally seen for BCH/USD over eight days initially, it isn’t too surprising seeing a pullback. When any market sees such chunky short-term moves, it does leave it very much vulnerable to a pullback, profit-taking from the highs. Consequently, this is occurring for Bitcoin Cash and several of its peers.

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.

Featured image courtesy of Shutterstock.

Author:
Ken has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.