The price of Bitcoin Cash is crashing this morning and is likely to capitulate if the next level of key support fails to stem the bleeding. Bitcoin (BTC / USD) just sliced the 200-day moving average like a hot knife through butter, which will have serious implications for the cryptocurrency market as a whole and the Bitcoin Cash price in particular.
Cryptocurrencies are highly correlated and, for the most part, will react to the price of Bitcoin. However, of all the correlations with Bitcoin, Bitcoin Cash is the highest. Therefore, Bitcoin’s collapse is likely to spill over into BCH. This morning, BTC is expanding yesterday’s losses and trading below the DMA 200 for the first time since August 3. As a result, Bitcoin Cash is down around 13% and also below the 200-day moving average.
BCH Price Analysis
The daily chart shows that BCH is below the 50, 100 and 200 day moving averages. Additionally, the former support levels at $ 624, $ 621 and $ 605 now offer considerable resistance. However, the price collides with the support at $ 525. Although given the destruction at the top of the crypto leaderboard, I expect $ 525 to fall soon.
Things go downhill below $ 525. If the Bitcoin spot price closes below $ 525 during today’s session, I expect another selloff. In this case, $ 400 seems like an obvious target. The steep declines in January, June and July all reversed between $ 380 and $ 400, indicating strong demand at this level. Therefore, unless the cryptocurrency market experiences a colossal liquidation event, $ 380-400 is expected to hold. As long as BCH stays below major moving averages, the most likely direction is lower and the $ 400 price target is intact. However, if Bitcoin Cash recovers the 200 DMA at $ 605, the bearish view becomes invalid.
Bitcoin Cash Price Table
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