- Bitcoin incredible bull rally hit a snag above $480 opening the Pandora box.
- BCH/USD has a higher chance of reversing the momentum towards $480 supply area.
Bitcoin Cash has remained range-bound with the short-term outlook ranging well. The breakout on Tuesday this week sent the price to highs at $483.15 (upper supply zone). However, due to lack of enough buying power, the bulls could not sustain higher growth leading to a retest of the broken support area at $425.
BCH/USD 4-hour chart
The increasing bearish pressure pushed the price to the demand area at $401.37 right before the close of the session on Thursday. Following the establishment of the support slightly above $400, the Bulls forced a reversal above the upper range limit at $425. While trading at $438.26, BCH/USD is immediately supported by the 50 exponential moving average (EMA). Moreover, the divergence in the Moving Average Convergence Divergence (MACD) points towards an increasing momentum to the north in the current session.
Immediately above the current value, the upside is limited by the EMA21 at $440. The second resistance lies at $480 (resistance congestion level) while the third hurdle is observed at $500 (resistance congestion zone). If BCH/USD clears the resistance at this level, it will be an indication of the beginning of a bull rally that could eventually test $520 and $600 towards the end of June 2019.
Bitcoin Cash is supported by the ascending trendline. The price has since the first week of May maintained above the trendline, therefore, if the short-term support, BCH/USD has a higher chance of reversing the momentum towards $480 supply area. The upper range limit at $425 will also offer support. Other key support levels for this asset include $400, the lower range limit and the primary support at $280.
Bitcoin Cash Key Technical Indicators
MACD 4-hour: Increasing divergence is an indicator of the strengthening of bullish pressure.
EMA21 4-hour: Break above this level would mark bulls’ confidence in the momentum.
Key support areas: $400, $350 and $280.
Key resistance areas: $425 (upper range limit), $480 (supply area) and $500.