A series of lower highs and lower lows highlighted a descending channel as Bitcoin Cash continued to erase gains from the market. However, the 200-SMA (green) could act as a fail-safe against a breakdown and spur a fresh high within the pattern.<\/p>\n
Considering a risk-off broader market, expect BCH to oscillate within its current pattern and rebound from a strong buy zone. At the time of writing, BCH traded at $574.4, down by 2.8% over the last 24 hours.<\/p>\n
Source: BCH\/USD, TradingView<\/p>\n
The 200-SMA (green) was key to BCHs near-term trajectory. The candles have respected this moving average on five occasions so far, with almost each contact triggering a run up to the upper trendline.<\/p>\n
A continuation of this trend would see BCH prepare for another high slightly above the $600-mark, provided the alt does not falter at mid-line of the pattern or the 38.2% Fibonacci level.<\/p>\n
With weak inflows across the broader market, an early upwards breakout would most likely be met with immediate rejection, within the pattern. Ideally, the stronger demand area at 23.6% Fibonacci level would be a better fit to enforce a breakout from the pattern.<\/p>\n
Meanwhile, near-term traders need to be cautious of a breakdown to $520. A weakening RSI and unfavorable DMI presented opportunities for more sellers to jump on board.<\/p>\n
Reasoning<\/p>\n
Now the 4-hour RSI has been declining since early October and confirmed with BCHs price action. With RSI now below the mid-line, some more losses were anticipated before a reversal. Moreover, a bearish DMI coupled with an ADX reading of 33 meant that BCHs downtrend was gaining more steam.<\/p>\n
Finally, the MACD did little to alleviate any fears of a market decline. In fact, short-selling was a threat after the index made its way below the half-line.<\/p>\n
Conclusion<\/p>\n
The 200-SMA (green) could provide an immediate response to the burgeoning selling pressure in the market. However, expect the lower trendline to be tested on a few more occasions over the next 24 hours. If BCH does maintain its ground within the pattern, buyers can punch back the 23.6% Fibonacci level and trigger a break to the upside.<\/p>\n
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Bitcoin Cash: Why this moving average could be key for a break to the upside - AMBCrypto News<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" A series of lower highs and lower lows highlighted a descending channel as Bitcoin Cash continued to erase gains from the market. However, the 200-SMA (green) could act as a fail-safe against a breakdown and spur a fresh high within the pattern. Considering a risk-off broader market, expect BCH to oscillate within its current pattern and rebound from a strong buy zone. Continue reading