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On Friday, the global cryptocurrency market began in the red, with Bitcoin trading below the $32k level. While other cryptocurrencies fell as a result of the widespread pessimistic mood, Bitcoin Cash managed to limit its losses. At press time, the alt’s price was approaching a critical support level, which may be expected to ignite a northward push in the future.
Bitcoin Cash was trading at $456 at the time of writing, down $0.03 percent in the previous 24 hours.
Bitcoin Cash 4-hour chart
The movement of Bitcoin Cash after its swing high of $457 on June 29 resulted in the creation of a descending triangle, with the bottom trendline representing a support level around $470-$475. On 13 July, the defensive region was breached, resulting in a 6% loss measured from the pattern’s bottom trendline.
Since the crash, BCH has mostly oscillated between two points: $475 resistance and $445 support, forming a horizontal channel. Yesterday’s modest rebound was aided by the aforementioned support level, but the price appeared to be constrained by the 20-SMA (red). Because the larger market has yet to show signs of recovery, Bitcoin Cash is anticipated to fall over the next few sessions and return to its defensive level of $445, from which a bounceback is predicted.
The northward trend of the Relative Strength Index showed that market purchasing pressure has been growing. Before testing the equilibrium point, the index might find support at a higher low — possibly between 37-40. The general market trend, according to the Directional Movement Index, was negative, albeit the -DI and +DI lines did converge.
A reading of 29 on the ADX indicated that the market was directional enough to show strong moves in either direction. The Squeeze Momentum Indicator revealed that bearish momentum has been decreasing over the last few days.
While Bitcoin Cash seems to be reacting to a broader drop in the crypto-market, the $440-$445 support region is likely to soften its loss and generate a minor rebound. Some indicators suggested that bearishness was waning and that the odds of a prolonged sell-off were limited. However, numerous uncertainty remained in the larger market, and traders should proceed with caution before longing BCH at its support zone. Waiting for obvious evidence of a reversal before making a trade might be a safer idea.