Technical Analysis and Market Entry: Bitcoin Cash – Another Fast 40% Up for Grabs
- The Bitcoin Cash (BCH) price has cleared a major supply zone, leaving the door open to further potential buying pressure.
- The next major area of resistance is not seen now until the $600 price territory.
BCH/USD: Recent Price Behavior
Bitcoin Cash is firmly within the control of the market bulls, as the price further resumes its strong recovery mode. The buying momentum observed is aggressive, as the BCH shoots higher then has a brief period of consolidation ahead of greater upside. The gains seen for the month of May alone are somewhat astronomical, having jumped over 75%.
The surge higher in May really picked up some pace after the bulls smashed out to the upside from a bullish flag structure. BCH/USD was consolidating throughout the month of April, which resulted in the noted technical formation. Following the breach on 11th May, the bulls once again took a breather (this was observed from 11-26th May).
During the above-detailed period, BCH/USD formed a bullish pennant pattern, which was subject to a breakout. The bulls have maintained the current course of their buying pressure, forcing an exposure acting resistance, resulting in another wave of buying pressure. As a result, BCH/USD jumped to its highest level seen since 14th November 2018.
Game-Changing Resistance Breakout
It is vital to know that during the most recent pennant pattern breakout, bulls were also able to drive the price above a critical supply zone. The noted territory tracks from $365 up to $410, and BCH/USD had not comfortable traded above this since mid-November 2018. The BCH bulls were dealt several blows before they were able to find enough momentum.
Over the last three sessions, BCH/USD has promisingly stabilized just above the former acting supply zone. The bulls are now using this area as new comfort, preventing a free-fall back down south. Given the significance of the zone, the support does appear to be very much promising for a potential launch-pad to further heights.
Near-term Bull Flag Breakout
Bitcoin Cash’s price action via the 4-hour chart view had formed a bullish flag structure; however, a strong breakout to the upside was seen on Wednesday 29th May. The formation started to take place from 27th February before an escape from the confinements. Any dips in the price continue to be bought by the bulls with decent power.
If an entry was missed after the last detailed Bitcoin Cash analysis article, there is still another potential opportunity. As detailed above, the price has broken out from a flag to playout to the textbook, which means a retest may occur. If the price does cool marginally back south, an entry down at around $430 would be attractive.
In terms of upside targets; $600 and then $650 within the near-term should be eyed. Stops could be placed just below the flag formation at $415.
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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