Bitcoin Cash is attempting a recovery, after a correction earlier this year, but the broader market structure still points to consolidation.
According to the crypto analyst Umair Crypto, in January, an inverse head and shoulders pattern near $590 failed, trapping bullish traders. Price broke below the 200-day moving average and slid nearly 28 percent, ultimately bottoming close to $423.
Since then, a new inverse head and shoulders has formed and triggered a strong bullish impulse of about 12 percent.
BCH has reclaimed the 200-day moving average and is trying to hold above it, signaling improving short-term control. Structurally, a key liquidity void now exists between current levels and the $580 region.
Also Read: Bitcoin Cash (BCH) Tests Resistance as Analysts Warn of $475 Retest
Bitcoin Cash (BCH) Targets $593 Amid Range Consolidation
The point of control is around the $593 mark, which could be a price level where the price might be attracted before a deeper test of the $535 level.
Looking at the bigger picture, we can see that the price has moved back into the value area between $507 and $607, which has been a price range that has been respected for around 228 days in total.
Source: Umair Crypto X Post
Volume remains the concern with the rally. The impulsive move has created an imbalance and low participation zone that could be revisited in the event that the buying interest doesn’t continue to grow.
BCH has been exhibiting good recovery action above its long-term average; however, it is still within the range and not breaking out.
BCH’s RSI and MACD Shows Bullish Momentum Ahead
According to TradingView, the Bitcoin Cash chart on the daily time frame reveals a strong run-up to early January, topping out near the $650 to $670 price point before commencing a pullback.
The selling accelerated in early February, with a long wick to the low $430s indicating capitulation. Since then, the price has been rallying strongly, retaking the $560 to $570 area and testing former consolidation resistance.
Source: TradingView
The momentum indicators point to improving bullish conditions. The RSI is in the mid-50s, which reflects a rise in momentum without any overbought pressures.
The MACD has turned positive with a bullish crossover and increasing positive histogram bars. The price has to stay above the support levels of $540-$550 and break through the levels of $590-$600 to confirm the trend continuation.
Also Read: Bitcoin Cash (BCH) Holds Support as Analysts Eye Breakout to $950