Disclaimer: The findings of the following article should not be taken as investment advice, with the same deduced based on the current volatility in the Bitcoin Cash market
With the collective market indecisive with respect to opting for a market trend, altcoins in the middle seem to be enduring a lot of the collateral damage. Bitcoin Cash was one of these crypto-assets, with the altcoin noting a steep depreciation in value after attempts were made to recover key resistance levels. At press time, the consensus seemed to be bearish, with the spike registered 48-hours ago deemed to be a bull-trap. Bitcoin Cash was valued at $260, at the time of writing, trailing behind Chainlink and Polkadot on the charts.
Bitcoin Cash 12-hour chart
Source: BCH/USD on TradingView
The resistance level at $325 was tested three times in the month of August alone, as illustrated by the analysis. However, in the meantime, Bitcoin Cash was repeatedly able to sustain a position above the support range of $270-$277. Before its last spike witnessed on 1 September, the crypto-asset had registered a bounceback from this range itself. But at the time of writing, 24-hours later, the token was well below the liquidity pocket.
The drawdown also contributed to the 50-Moving Average acting as overhead resistance, with the Relative Strength Index pointing to the emergence of selling pressure. The falling wedge did foresee a bullish break, but the rally was not sustained. With inconsistent trading volume seen during the course of August, it was difficult to point towards a definite trend, at press time. However, indicators seemed to suggest that a bearish trend had more stake in the market.
Bitcoin Cash 4-hour chart
Source: BCH/USD on TradingView
The severity of Bitcoin Cash dropping below $270-$277 was evident on the 4-hour chart. As mentioned above, the support range remained extremely important because of the trading activity registered around that price point. At the time of writing, Bitcoin Cash was close to its long-term support of $244, rather than its resistance at $298. For Bitcoin Cash, it seemed like an uphill battle from here on to sustain another recovery on the charts.
With the VPVR highlighting its position at a low trading zone, the chances of further price movement are still there. A return above $270 would be a positive development, but it is too early to expect anything at the moment. Over the next week, with subsiding volatility, the overall market picture should attain more clarity.
