A steep southward journey has been underway for Bitcoin Cash [BCH] since its early April reversal from the $390-zone. Since then, the price has mostly been confined to the lower Bollinger Band (BB) band.
The ongoing assault on the chart would continue if there were a convincing close below the resistance of the three-month trendline (yellow, dashed).
Any close above the BB’s basis line could support buying efforts to counteract bearish inclinations. At the time of publication, Bitcoin Cash was down 1.39 percent in the previous day’s trading, trading at $109.6.
Daily BCH Chart
By pushing BCH towards its more recent multi-year lows, the bears have taken advantage of the heightened fear sentiment. The three-month trendline resistance has clearly restrained the buying power.
The altcoin experienced a staggering 74.4 percent devaluation (as of 5 April) as it recently descended toward its December 2018 lows. On June 30, BCH began to incline toward the 42-month low.
The lower and upper bands of BB appear to be converging, which suggests that the altcoin may extend into a squeeze phase over the next few days. Additionally, during the most recent up-channel recovery, trading volumes decreased. This interpretation implied a timid bullish move.
Any close below the immediate resistance would push BCH lower, possibly as low as $101 in the process. After this, a barrier close to the Point of Control would probably block the bullish revival efforts (POC, red). In the $120 range, an immediate recovery would likely be fleeting.
The 42-resistance was struck by the bearish RSI over the past three days. A persistent position below this level would help the sellers cause chart sell-offs.
In addition, the OBV recorded lower peaks over the previous week and diverged bearishly from the price movement. The DMI lines had not yet made a bullish crossover, in fact.
Given the cluster of obstacles close to the POC, BCH may continue to be sluggish over the next few days. The objectives would not change from before.
However, the 30-day correlation between BCH and the king coin is an astounding 91%. Therefore, it would be essential to monitor Bitcoin’s movement in order to make a wise choice.