Defying Wider Market Downtrend, Bitcoin Cash Eyes $3K

Bitcoin cash looks set for a gravity-defying move upwards.

Data source CoinMarketCap shows the world’s fourth largest cryptocurrency by market capitalization rose as high as $2,961 yesterday before closing the day (as per UTC) at $2,895.38.

However, prices dipped to a low of $2,396 at 04:34 UTC, possibly in response to reports that South Korea – one of the world’s largest cryptocurrency markets – is considering an outright ban on cryptocurrency trading.

As of writing, bitcoin cash (BCH) is trading back up at $2,670 levels – up 5.57 percent in the last 24 hours. Also, BCH is bucking the broader market trend. As per CoinMarketCap, bitcoin has depreciated by 2 percent in the last 24 hours. Meanwhile, ethereum and Ripple are down at least 9 percent each.

In further good news for bulls, the technical charts indicate BCH could extend the 11.76 percent rise from the intraday low further towards $3,000 levels.

Bitcoin cash chart

The above chart (prices as per Bitfinex) shows:

• A series of higher lows as represented by the rising trend line.
• A rounding bottom (lower lows followed by higher lows), indicating the bears have lost control.
• Bullish (upward sloping) 50-day moving average.
• Congestion ended with an upside break yesterday, adding credence to the above bullish factors and indicating scope for a move above the $3,000 mark.

Today’s price drop need not be interpreted as a sign of “failed bullish breakout” as markets usually shake out weak hands (traders with tight stops/ less risk tolerance) after a big bullish/bearish move.

View

• BCH looks set to test $3,000 levels and possibly extend gains to $3,500–$3,600 levels over the next one week.
• Only a close (as per UTC) below $2,050 (Dec. 30) would neutralize the bullish view put forward by the rounding bottom formation.

Roller coaster image via Shutterstock

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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.