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Detailed BCH Technical Analysis
Welcome back to another edition of The Crypto City Trading Newsletter, your go-to source for in-depth technical analysis and expert insights into the dynamic world of cryptocurrency trading. Today we are focusing on the Daily and Weekly price action of BCH/USDT.
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Total AVAX Market Cap:Â Â Â Â Â Â Â Â Â Â $$7,350,981,791
Circulating Supply:Â Â Â Â Â Â Â Â Â Â Â Â Â 19,732,419 BCH
Total Supply: Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 19,732,419 BCH
Max Supply: Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 21,000,000 BCH
Overview
This technical analysis provides an in-depth look at the AXS. The analysis focuses on identifying key support and resistance levels, recent price movements, and possible future scenarios. By analyzing these factors, traders will gain insight into the current market condition and make better trading decisions.
Bitcoin Cash (BCH) has experienced significant volatility over the past year, marked by a notable uptrend at the beginning of 2024, where the price surged from below 200 USDT to above 700 USDT by April 2024. This bullish momentum was followed by a correction phase, bringing the price back to the 300-400 USDT range, where it is currently trading around 374.9 USDT.
The chart highlights several major support and resistance levels that traders should keep an eye on. The immediate daily support zone (Purple) at $354.8 – $364 is important, as recent interest in buying has emerged, potentially indicating a short-term bullish reversal. This level has proven to be an important turning point for the price, and staying above it could provide additional upward momentum. Below this, a more solid weekly support zone (Green) exists between $285.4 – $298.3.
The immediate resistance is at $411.4 level. This level is an important barrier that the price must flip in order to confirm a continued bullish trend. A successful break above this resistance might lead to a test of the next major daily resistance zone (Yellow) at $517.3 – $531.2, another historically important level where selling pressure has historically restricted upward momentum. After that, the key resistance zone in Blue poses a significant test to bulls. This region represents the previous high and would require significant buying interest to be breached, possibly opening the path for new highs.
The overall trend indicates a positive outlook provided the current support levels hold. The current bounce from the lower support zone, as well as volume analysis, show that the latest price increase has been followed by significantly reduced trading activity when compared to the spikes recorded during the strong rally earlier this year. This divergence might indicate a lack of substantial buying pressure at current levels.
The analysis discusses both bullish and bearish scenarios, outlining potential outcomes depending on price movements above important resistance levels or below critical support levels. The objective is to provide traders with an extensive understanding of current market dynamics, allowing them to predict price movements and adjust their trading strategies accordingly.
We are now moving toward the chart.
Weekly Chart
In the weekly chart, BCH is looking bullish on the weekly chart and trading on the monthly support zone (Green) of $275 – $299.7. After the rejection from the monthly zone (Blue), the price makes the support at the Green zone. If this zone (Green) fails to hold the price we might see it to the next weekly support zone (Yellow) at $200.2 – $210.5. However, according to our analysis, we are not expecting the price to break the monthly support zone (Green). If it does we add more BCH/USDT to our spot bags. We will discuss the buying plan in the trading setup section.
Daily Chart
Now we are zooming in on a Daily chart. BCH is trading on the daily support zone (Purple) at $354.8 – $364 and bounced back from the weekly support zone (Green). The price has recently broken above the zone (Purple) and resistance becomes support here. The price has to break above from $411.4 resistance to stay bullish. Several key technical elements and zones are marked, providing a comprehensive view of the market’s structure and potential future movements.
Key Zones and Levels
Daily Support Zone (Purple) $354.8 – $364
The immediate support zone (Purple) at $354.8 – $364 is a critical point for the current price action. Historically this zone acted as a strong support zone. The price has bounced back many times from here. If the price manages to stay above this support, it can signal a potential bullish reversal or continuation of the current upward momentum.
Weekly Support Zone (Green) $285.4 – $298.3
This zone has historically acted as a safety net for the price, preventing further declines during bearish phases. The multiple touches and rebounds from this range highlight its significance, making it a key area for bulls to defend. A breach below this range could lead to increased selling pressure, pushing the price towards lower support levels. Conversely, holding this support reinforces the possibility of a price recovery.
Weekly Support Zone (Pink) $199.8 – $212
 Historically this zone acted as a strong support zone. The price has bounced back many times from here. If the price falls to this zone that is the best buying opportunity.
Immediate Resistance at $ 411.4
This resistance acts as an important barrier to upward movement in the price. After the price flipped this level, it confirmed the reversal.
Daily Resistance Zone (Yellow) $517.3 – $531.2
This is a major resistance zone and a substantial barrier for the price to move upwards. Historically, the price was rejected many times from this zone. From mid-April to the start of June the price tested this zone many times and every time we see a strong pullback. Flipping this resistance zone would suggest a strong bullish sentiment and could attract additional buying interest, leading to further price increases. Failure to break this level could result in a consolidation phase or a pullback, as traders may look to take profits at this point.
Monthly Resistance Zone (Blue) $710.7 – $775.1
This resistance zone represents a significant long-term resistance area. This zone indicates the last top from which the price has rapidly reversed, showing significant selling pressure at this zone. Breaking over this zone would be a huge bullish indicator, perhaps resulting in new highs and a strong upward trend.
Volume Analysis
Currently at the time of writing the trading volume is at $21.29M, indicating a lack of strong buying interest at the current levels. A significant increase in volume would be necessary to confirm any potential reversal or breakout.
Recent Price Action
After a bounce from the weekly support zone (Green), the price is currently on a daily support zone (Purple). The price has to flip next resistance at $411.4 to stay bullish.
Potential Scenarios
Bullish Scenario
If BCH can maintain above the daily support zone (Purple), it may target the immediate resistance at 411.4 USDT. Breaking above this level could lead to a test of the daily resistance zone (Yellow) at $517.3 – $531.2.
Bearish Scenario
If BCH fails to hold the daily support zone (Purple), it might retest the weekly support zone $285.4 – $298.3. A break below this level could result in a further decline towards the $256.2 level and if declines continue we might see the price to weekly support zone (Pink) at $199.8 – $212.
Technical Indicators
Based on technical indicators on a daily time frame
The relative Strength Index (RSI) value is at 49.9 (Neutral)
Momentum (10) is at -0.3 signaling a (Buyl)
MACD Level (12, 26) is at -17.9 signaling (Buy)
Exponential Moving Average (50): 398.7 (Sell)
Exponential Moving Average (100): 416.2 (Sell)
Simple Moving Average (100): 456.7 (Sell)
Exponential Moving Average (200): 390.9 (Sell)
Ichimoku Base Line (9, 26, 52, 26): 355 (Neutral)
Volume Weighted Moving Average (20): 355.6 (Buy)
Hull Moving Average (9): 367.4 (Buy)
Interpretation
Bitcoin Cash (BCH) is currently unclear. With a neutral overall summary and a balanced distribution of buy and sell signals, traders should proceed with care. The oscillators are mostly neutral, with only a couple indicating potential short-term positive momentum. Meanwhile, the moving averages show a mixed picture, with shorter-term indications indicating a bullish trend and longer-term indicators pointing to a negative one.
This buyer-seller equilibrium indicates that BCH/USDT is at a key juncture, with the price potentially swinging in either way depending on market conditions. Traders should pay close attention to major support and resistance levels and be prepared for potential volatility.
Liquidation Heatmap
This heatmap illustrates the liquidation levels for Bitcoin Cash (BCH) over a three-month span. The color intensity reflects the concentration of liquidation activities, with brighter hues indicating higher leverage and a greater likelihood of liquidations. A key observation is the highlighted price range of $531.55 to $535.06, marked with a red arrow and box, signifying significant liquidation activity or a crucial support/resistance level. The overlaid line graph showcases BCH’s price trajectory, with noticeable volatility including a sharp decline in late June followed by a rebound in early July. The vertical color bands suggest periods of heightened liquidation activity, likely driven by the closure of leveraged positions. This visualization underscores the dynamic interplay between BCH’s price movements and leveraged trading activities, pinpointing areas of potential market stress.
Long-Term Trading Setup
BCH right now is dropping and we see there might be an opportunity to buy when it falls further. So we will buy in parts, we will divide our budget into 3 sections, and allocate for buying at each key support mentioned in the chart.
Here are the numbers where you can buy BCH and take profits for the trade.
Buy 1: $372.3
Buy 2:$298.3
Buy 3:$212
At buy 3 we will go all in because this is the lowest we are expecting BCH to fall.
TP1: $517.3
TP2: $710.7
TP3: $775.1
Conclusion
In this edition of The Crypto City Trading Newsletter, we provided a detailed technical analysis of BCH/USDT, exploring key support and resistance levels, recent price movements, and potential future scenarios. Bitcoin Cash (BCH) has shown significant volatility, with notable uptrends and corrections over the past year. Currently trading around 374.9 USDT, BCH is navigating crucial support and resistance zones that will dictate its short-term and long-term movements.
The analysis indicates a potential bullish reversal if BCH can maintain above the daily support zone (Purple) at $354.8 – $364. However, failure to hold this support could lead to a retest of lower weekly support zones, potentially creating buying opportunities for long-term traders. Key resistance levels, particularly at $411.4 and $517.3 – $531.2, will be critical to monitor for any bullish continuation.
Technical indicators present a mixed picture, suggesting a neutral overall summary with balanced buy and sell signals. Traders should exercise caution and closely watch major support and resistance levels, considering potential volatility in the market.
Investment Outlook
Given the current market conditions, BCH presents both opportunities and risks. The identified key levels should guide investors in making informed decisions. Caution is advised until a clear trend is established.
Your Essential Trading Newsletter
This detailed analysis provides a comprehensive understanding of the current market structure and potential scenarios. Traders can use these insights to make informed decisions and effectively navigate the market.
Stay tuned to The Crypto City Trading Newsletter for more in-depth analyses, market insights, and expert guidance. As always, we strive to empower you with the knowledge and tools needed to navigate the fast-paced world of cryptocurrency trading. Happy trading!
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The Crypto City Trading Team