Technical Analysis and Market Entry: Bitcoin Cash Eyeing Big Bull Breakout
- Bitcoin Cash is on a strong run to the north, rallying for seven consecutive weeks, gaining over 120%.
- BCH/USD price action via the daily is narrowing; a pennant structure is observed and subject to a breakout.
BCH/USD: Recent Price Behaviour
Bitcoin Cash price is currently within a form of consolidation, following aggressive moves higher seen in January. It had gained as much as 100% from the start of the year; rallying from depressed levels of $190, up to a recent high at $399. BCH/USD was recently able to push to heights not seen since July 2019. That was a time when the market was firmly within the control of the bears, having fallen from $515 down to $169.
Price action has been narrowing over the last seven sessions, moving within a range of $399 down to $365. The tightest conditions that were last seen in December, when the price was attempting to bottom out. BCH/USD is being supported by a known area of demand, which has previously attracted a decent amount of buyers. It can be observed running from $380 down to $350.
Weekly Chart View
Price action via the weekly chart has been rallying to the upside for going on seven consecutive weeks. During the noted period, BCH/USD has gained some 120%; it is the most consecutive run higher since February – April 2019. The market bulls were able to break out from a descending channel structure, which had been containing the price since July 2019. Since the breakout, BCH/USD bulls have been able to run free, aggressively moving to the upside. There is a lack of signage that this current trend will be shifting anytime soon.
Daily Chart View
BCH/USD, as mentioned earlier, is more within a tight trading range, however, has managed to form a bullish pennant structure, which is subject to a breakout. The pole of the pennant was the push higher from 26 – 28 January, with the actual pennant forming during the current seven sessions of consolidation.
Given the above detailed bullish technical structure, further moves to the north are still attractive from the current market price area. In terms of upside targets; $420m $450 and then $500. Stops to be placed just below the pennant at $359.
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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