Bitcoin Cash Technical Analysis: BCH Drops After Flashing Sell Signal
Daily Bitcoin Cash BCH Price Analysis
- Parabolic SAR has reversed from bullish to bearish in the daily chart.
- IntoTheBlock shows strong resistance at the $500 psychological level.
Following a horrendously bad Monday, the bulls somehow managed to take back control this Tuesday. While the gains are still minimal, the buyers should want to take back control and push the price back into the $500 psychological level.
BCH Dips After Flashing Sell Signal
This Sunday, the price flashed a sell signal in the form of a green-nine candlestick in the TD sequential indicator. Since then, the price dropped from $600 to $475. This Monday, the price reached an intraday low of $395 before it bounced up from the support provided by the 20-day SMA.
Image: BCH/USD daily chart
As per IntoTheBlock, there is a strong resistance zone at $500, wherein 64,000 addresses had purchased 1.11 million BCH tokens. This level looks strong enough to absorb a lot of buying pressure. Even if the buyers conquer this level, they face another obstacle at $525.
On the downside, the price has one moderate support barrier at $425. If the bears retake control, they could potentially drop the price to the 20-day SMA ($400). The 4-hour price chart shows that the market momentum in this timeframe is bearish. Plus, the Bollinger has started contracting, which shows that the price is no longer as volatile as it previously was.
Image: BCH/USD 4-hour chart
BCH Price Levels To Watch
If the bears take control, they would ideally want to break the price below the $450 support barrier and reach the 20-day SMA ($400). On the upside, the bull face resistance at the $500 psychological level. If the buyers manage to break above this, they should reach $525.