Technical Analysis and Market Entry: BCH/USD Subject to Another Wave of Selling Pressure
- Bitcoin Cash price is consolidating ahead of further committed moves within the current trend.
- BCH/USD has formed a bearish flag structure via the daily, as pressure to the downside mounts.
BCH/USD: Recent Price Behaviour
Bitcoin Cash has been moving within consolidation mode, following the steep falling seen through November. The price dropped as much as 35% during trading last month; it was the worst monthly performance since September. BCH/USD has been forced to trade back down at the lowest levels since April 2019.
In terms of the detailed decline, it came following a rebound had been staged through October. However, during this gradual push higher, it formed a bearish flag pattern, which the sellers managed to capitalize on. The price has struggled since losing upside momentum back in June. Bitcoin Cash had made such an initial strong start to 2019, having rallied some 370%.
The price had rallied up to at $515 before the profit-taking came into play. BCH/USD has been stuck within a bearish trend since, as rallies continue to be sold by the bears. From July to September, there was a long consolidation run, range-bound trading a no commitment. It was after the heavy selling had come into play, as mentioned in June.
Price action formed a bearish pennant structure, given the sideways movement. Sellers managed to break out of this pattern on 23 September; it had invited a fresh bought of pressure to the downside. The price has since retested the pennant and was hit with another strong rejection.
Bear Flag to Spark More Selling
Since the 22 November, price action has again been consolidating, after the above-noted rejection. BCH/USD has managed to find some stable footing around the $200 price mark, an area which is known for buyers. The price behaviour, however, has formed another bearish structure, a flag pattern, which is subject to a breakout. Currently, the daily candle at the time of writing is pressing to the downside, attempting to force a closure below.
Given the above-detailed flag structure, further moves to the south remain attractive. A short position from the current market price looks opportunistic. Targets of interest would be; $180, $170 and then $120. Stops would be placed just above the flag at $240. A daily closure below the detailed pattern would be a confirmation. Further entries could be placed upon a breakout and then retest of the flag.
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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