Bitcoin Cash Price Analysis

We have not seriously covered the price of Bitcoin Cash for quite some time (ever since the split between the ABC and SV protocols) because the price of the two assets were moving in unison for the most part.

However, now, there appears to be significant divergence in the price of the two assets, and they are now no longer moving in lockstep with one another.

Bitcoin Cash Price Analysis

In the graph above, we can see that there’s been a strong, short-term downtrend resistance for Bitcoin Cash since approximately November 16th, 2018.

In the photo above, the distance between that downtrend resistance and the price that Bitcoin Cash is at currently is depicted as well. This is done to show the maximum (theoretical) upside for Bitcoin Cash from this point moving forward.

However, before ascertaining whether this makes Bitcoin Cash an asset worthy of placing money into, let us first examine what the momentum indicators and oscillators are telling us.

Relative Strength Index(14)

To begin with, we’re going to check out the RSI(14) for Bitcoin Cash on the H4 resolution:

As we can see in the chart above, there has been a significant downtrend in the RSI(14) for Bitcoin Cash on the H4 resolution.

This is both positive and negative for the following reasons:

A) It is positive because it means that the price is consolidating after a major price run (which is healthy behavior).

B) It is also negative because there is a lot more distance to go before the RSI(14) hits what we could conventionally label as ‘oversold’ in this bear market [i.e., a value of 20 or lower].

Now, let’s check out the RSI(14) on the daily resolution

Daily Resolution RSI(14):

The RSI(14) here is a bit too wonky to make any definitive determinations from what we can see in the chart above. It is possible that the latest movement for the RSI(14) on the daily resolution will serve as the second point of the ‘downtrend’ in the RSI(14), which continues into the near future; but only time will tell.

To understand what we’re talking about, take a look at the following chart:

Zerononcense Double Guppy

The ZN Double Guppy is not reflecting that the sell off is over-extended either. That would occur when the price has hit the bottom portion of the ZN Double Guppy. Right now, the price is still trading in that middle ‘orange’ channel that you see in the picture above.

This means that the price is in a ‘normal’ range.

Exponential Moving Averages (EMA)

The EMAs dictate the support and resistance points for the price action.

Let’s check out where it is for Bitcoin Cash:

Currently, the most relevant EMA is the EMA-50, which is directly overtop of the price at $222. Without coincidence, this is also where the price was originally pushed down (EMA50 served as resistance).

The EMA stack at the time of writing (on the daily resolution) =

200>100>50>26>12, which means that the bearish sentiment that has been pervasive for Bitcoin Cash has not been reversed by any of the recent price action.

Currently, it appears that there has been a slight bounce off of the EMA-12, but there should be extreme caution exercised on Bitcoin Cash for any and all traders (not financial advice).

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Yes No