Will Bitcoin Cash (BCH) Repeat Its Breakout Above $300?

    Bitcoin Cash (BCH) has surged by 260% without experiencing any retracement. However, based on the wave count, there is a possibility of a short-term decline before the price continues its upward trajectory.

    Bitcoin Cash (BCH) Price Breaks Through $300

    Bitcoin Cash (BCH) has exhibited an impressive rally after hitting a new yearly low of $90 on June 10. Just 11 days later, it broke out from a descending resistance line that had been in place since February, confirming the conclusion of the correction and paving the way for new highs.

    The subsequent surge in BCH price has been remarkable, with a 260% increase and no retracement observed, pushing the value to a new yearly high of $320 on June 30, the highest since April 2022.

    BCH/USDT Daily Chart. Source: TradingView

    The long-term wave count for BCH remains decisively bullish. Utilizing the Elliott Wave theory, technical analysts study long-term price patterns and investor psychology to determine the direction of the trend. The wave count indicates that BCH is currently in wave three of a five-wave increase (white), which tends to be the most intense among the bullish waves.

    Notably, wave three has extended to 3.61 times the length of wave one, a considerable but not unprecedented level of extension for this wave.

    BCH Price Prediction 

    Upon closer examination of the short-term six-hour technical analysis, it appears that the price of BCH may have reached a local peak. This assessment is based on both the RSI and the wave count.

    Firstly, the six-hour RSI presents a bearish reading. Traders utilize the RSI as a momentum indicator to determine if a market is overbought or oversold, and to make decisions regarding asset accumulation or selling. The indicator is currently declining, revealing a bearish divergence (green line). This phenomenon occurs when a price increase is not accompanied by a corresponding increase in momentum, often leading to a downward movement.

    Secondly, the short-term wave count indicates that the price has completed an A-B-C corrective structure. However, since it has not yet reached the $235 Fib support level, it is plausible that the current decrease is merely the initial wave of a larger A-B-C structure.

    BCH/USDT 6-Hour Chart. Source: TradingView

    This aligns more closely with the length of wave three, as wave four is currently significantly shorter in comparison and is serving as a correction.

    Despite this bearish short-term prediction for the BCH price, surpassing the yearly high of $329 (red line) would indicate that the overall trend remains bullish. In such a scenario, the rally could potentially continue towards the next resistance level of $360.

    Disclaimer: Please note that this price analysis article is purely for informational purposes and should not be regarded as financial or investment advice.

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