Bitcoin cash price found support near $470 and recovered against the US dollar. However, BCH/USD is facing much important resistance near $620-650 on the daily chart.
- Bitcoin cash price recovery from the $470 low could be capped near the $620 and $650 levels.
- There is a significant bearish trend line in place with resistance near $630 on the daily chart of BCH/USD.
- The price is currently consolidating below the $600 resistance with bearish signs.
Bitcoin Cash price analysis
During the start of this month, bitcoin cash price declined heavily and broke the $700 and $680 support levels against the US Dollar. BCH/USD also broke the $600 and $500 support levels before buyers appeared near $470.
The daily chart of BCH/USD indicates that the price broke a key bullish trend line at $675 to move into a bearish zone. Later, it formed a short-term bottom at $470 and is currently correcting higher.
The price moved above the $500 resistance zone and also spiked above the 23.6% Fibonacci retracement level of the last significant drop from the $879 high to $470 low.
However, the upside move faced sellers near the $600 level and the price retreated below the $580 level. On the upside, there are many resistances aligned near the $600-620 levels. There is also a significant bearish trend line in place with resistance near $630 on the same chart.
Above the trend line, the 50% Fibonacci retracement level of the last significant drop from the $879 high to $470 low is positioned at $674, which is also the previous support area.
Therefore, if bitcoin cash price continues to move higher, it is likely to face sellers near the $620 and $650 resistance levels. Only a close above $675 and the 50-day simple moving average ($710) could open the doors for more gains.
On the flip side, if the price fails to move past the $600. $620 and $650 resistance levels, it may possibly resume its downside move towards the $500 level. In the mentioned case, there are even chances of a fresh yearly low below $470 in the near term.
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Aayush is a Senior Forex, Cryptocurrencies and Financial Market Strategist with a background in IT and financial markets. He specialises in market strategies and technical analysis and has spent over a decade as a financial markets contributor and observer. He possesses strong technical analytical skills and is well known for his entertaining and informative analysis of the currency, commodities, Bitcoin and Ethereum markets. Tou can follow him on twitter at @aayushJS or reach out to him at aayush[at]coingape.com