Bitcoin Cash / USD Technical Analysis: Reaching For The Sky
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- Bitcoin Cash has a bullish short-term bias, with the BCH / USD pair testing towards the best levels of the year
- Bulls have now invalidated a bearish head and shoulders pattern on the four-hour time frame
- The daily time frame shows a bullish triangle breakout underway
Bitcoin Cash / USD Short-term price analysis
Bitcoin Cash is bullish in the short-term, with the BCH / USD pair advancing to a fresh multi-month trading high and edging closer to its current 2019 trading high. The BCH / USD pair’s 2019 trading high is currently found at the $173.00 level and offers the strongest form of technical support above the $160.00 level.
The recent rally has also invalidated a bearish head and shoulders pattern on the four-hour time, which had been looming over the BCH / USD pair.
Technical indicators on the four-hour time frame suggest the recent rally is close to its peak and a bearish pullback may be nearing.
BCH / USD H4 Chart (Source: TradingView)
Pattern Watch
Further upside towards the $170.00 region should be expected while price trades above the head of the bearish pattern.
MACD Indicator
The MACD indicator is currently unclear on the four-hour time frame, with the MACD signal line extremely in overbought territory, while the MACD histogram has returned to neutral levels.
Relative Strength Indicator
The RSI indicator on the four-hour time is starting to turn lower and is showing bearish price divergence.
Bitcoin Cash / USD Medium-term price analysis
Bitcoin Cash has a neutral medium-term outlook, with the BCH / USD pair still trading below its 200-day moving average. The BCH / USD pair has, however, broken above a triangle pattern on the daily time frame, which is a bullish development.
The daily time frame also shows that a large price gap is still in existence from last year, with the gap extending all the way to the $382.00 level.
Key upside resistance for the BCH / USD pair is currently located at the $200.00 level and the December 2018 trading high, around the $230.00 level.
BCH / USD Daily Chart (Source: TradingView)
Pattern Watch
If bulls continue to rally the cryptocurrency, the size of the triangle pattern suggests that the BCH / USD pair could advance by over $65.00 from the bullish breakout point.
MACD Indicator
The MACD indicator is bullish on the daily time frame and is currently generating a strong buy signal.
Relative Strength Indicator
The RSI indicator on the daily time frame is bullish, although the indicator is moving towards overbought territory.
Conclusion
Bitcoin Cash is growing increasingly bullish over both time horizons and may soon target towards its current 2019 trading high.
The triangle breakout on the daily time frame is a significant technical development and could signal an eventual move towards the best levels of December last year.
Traders should be mindful that a large price gap is still in existence and typically price gaps do get filled over time.
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