Technical Analysis and Market Entry: BCH/USD Bulls Pushing For A Big Channel Breakout
- Bitcoin Cash price is demonstrating promising signs of a recovery, given the current run.
- BCH/USD has rallied for the past three consecutive weeks, gaining over 50%.
BCH/USD: Recent Price Behaviour
Bitcoin Cash has been pushing to the upside, having caught decent demand within a known buying area. The price is on a run of three consecutive weeks in the green; it is the best seen since October 2019. Over the noted period, BCH/USD has gained some 56%, pushing up to $280, the highest level achieved in nine weeks.
The price has been able to stabilize after dropping to the lowest levels in nine months, $169, last seen in April. BCH remains very much within a time of correction, following the decent push to recovery in the first half of 2019. BCH/USD had rallied from $104 in January, up to $518 in June, before losing all upside momentum.
Descending Channel Structure
Bitcoin Cash as noted above, lost control from the market bulls back in June, following a decent initial run north early in 2019. Since July, price action is moving within the confinements of a descending channel structure. Rallies continue to be sold, as the price gets rejected upon attempts to break out of the pattern. The market structure that can be observed is lower highs and lower lows within.
These types of patterns are the markets way of consolidating, which has been evident following the steep drop from late June to early July. Typically, a descending channel is subject to a breakout higher from the bulls; it is very much just a matter of when. Given the current weekly run being observed, there are some potential signs of promise for BCH.
In terms of where the price has most recently staged a rebound, it is a known area for buyers. A large amount of buying interest was seen within the $200 price mark back in April 2019. BCH/USD went on to rally to the heights of $500, before running into sellers in June. The next breakout from the bulls could be more impactful, given the duration the price has traded within the detailed channel.
Price action via the 4-hour chart view is forming a bullish pennant structure, subject to a breakout higher. Given the current price formation near-term and over the longer time-frames, further moves to the north are eyed. In terms of entry, a break and retest of the pennant would be ideal, at around $270. the current market price within the pennant at $260-65. Targets to the upside; $300, $330 and then $350. Stops to be placed below the pennant at $250.
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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