Trade Recommendation: Bitcoin Cash
The Bitcoin Cash/US Dollar (BCH/USD) pair came off lows of $471.10 on August 14, 2018. At that price level, the pair dropped over 84% from the 2018 high of $2,949. That’s a lot of value that dropped in eight months. This is a very good reason why we think the market is about to become bullish.
Technical analysis show that Bitcoin Cash is positioning to take out the large symmetrical triangle on the daily chart. This view comes after we see the market respect its historic support. This trendline has been intact since August 2017 so it would take more than a shakeout to breach this support.
Speaking of shakeouts, we are bullish on BCH even though it’s down by over 13% in the last 24 hours. This drop looks like the last hurrah of the bears. They can try to stop rallies but at the end of the day, they are exhausted. Plus, they are going against a historic support level. Bulls will pick them off and that’s what we’re seeing right now on the hourly charts.
The strategy is to buy as close to $485 support as possible. Volume in the lower time frames skyrockets whenever Bitcoin Cash touches the support. This tells us that bulls are defending their territory. If they continue to do that, they’ll generate the momentum needed to break out of the pattern and reach our target of $788.
The process may take a month.
Weekly Chart of Bitcoin Cash/US Dollar on Kraken
As of this writing, the Bitcoin Cash/US Dollar pair is trading at $499.10 on Kraken.
Summary of Strategy
Buy: As close to $485 support as possible.
Disclaimer: The writer 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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