Bitcoin Cash “lagging behind” could soon rally if …

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Warning: The conclusions of the following analysis are the sole opinions of the author and should not be construed as investment advice.

Bitcoin has climbed nearly 8% in the past two days, from $ 45.6,000 to $ 49.3,000, before dipping slightly to trade at $ 48.9,000 at the time of publication. Even so, it remains likely that Bitcoin will once again climb to $ 51,000 to $ 52,000 and could move the larger crypto market north alongside it.

On the contrary, Bitcoin Cash only gained 4% over this period. Simply put, Bitcoin Cash can lag behind.

Bitcoin Cash 1 hour chart

Source: BCH / USDT on TradingView

Price action over the past two weeks has been a range from the $ 490 band (red box) to the $ 415 band (cyan). Price has tested this area for demand several times over the past week and has rebounded after each retest. The most recent rebound struggled to push BCH above $ 435, and the $ 450 level also acted as resistance.

Plotting a range between $ 421 and $ 481, the middle of the range (white dotted line) was $ 451, representing significant resistance. Other than that, the entire $ 430 to $ 450 region seemed like a higher calendar zone, meaning there would likely be plenty of cash for the bulls to chew on before climbing higher.

Trendline resistance (white) was drawn from early November and remained undefeated, adding resistance to a rise for BCH.

The low volume of transactions, combined with relatively large purchases in the $ 420 area, indicated a possible accumulation phase.

Reasoning

Source: BCH / USDT on TradingView

The OBV has continued to climb in recent days, meaning that buyers have been strong in the market. It was also an encouraging sign for the bulls. The RSI was unable to climb above 67.7, although it did stay above the neutral 50 to highlight the recent bullish momentum.

On the price chart, the fixed range volume profile was plotted from December 6 when the price tested the low at $ 420.

One positive point that the bulls can take is that the price was above the control point (red) at $ 436, although the FRVP also indicated strong resistance around $ 450.

Conclusion

The Dead Cat rebounded earlier this month after the massive selloff saw BCH establish a range between $ 480 and $ 420. Since then, the price has hit the lower end of the demand-seeking range on several occasions and has rebounded each time. The buying pressure increased, although BCH faced strong resistance from $ 430 to $ 450 and another level at $ 470. Trading volume was low as market participants were sidelined and bought the $ 420 retests.

In conclusion, BCH has been in a buildup phase for the past couple of weeks, and going above $ 450 will likely see it hit the $ 490 area.


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