Hi friends hope you are well and welcome to the new update on Bitcoin cash. Recently a very positive move can be observed on the daily chart that after touching the support at $215 the price action moved up and broke out at $225 resistance again. At this time the price action is retesting the $225 resistance level as support that is really very good gesture because whenever the price action re-tests the previous resistance as support after breaking out then there are chances that the price action can move up to the next resistance level rather breaking down the support again.
The price action of BCH is struggling at 100 SMA resistance level:
If we watch the simple moving averages with the time period of 25, 50, 100, and 200 then still the priceline is struggling at the 100 simple moving average resistance and having the support of 50 SMA. If the price action will break out the 100 simple moving average then the next resistance of 200 simple moving average is at $270.
The pattern has been changed:
The price action of Bitcoin cash is moving in a wedge pattern. If we place the balance of power indicator then it can be clearly observed that the power between the bulls and bears is distributed equally. Whenever the balance of power is moving down or moving up the price action is following the signals and hitting this support and resistance levels accordingly. When the balance of power 8th time gave the bearish signal the priceline of BCH moved down at support but when the balance of power indicator gave the bullish signal the price action did not reach the resistance.
And when for the ninth time the balance of power moved down the price action broke down the support of wedge. Therefore now the pattern has been changed from wedge to parallel channel.
A big harmonic move:
Now I would like to recall a very big bullish Gartley pattern that I have shared in my previous articles as well. This pattern has been formed by the protection of Bitcoin cash on the monthly chart. At this time the price action is moving in the potential reversal zone of this pattern.
As per the Fibonacci sequence, the price action can enter the Fibonacci projection of A to D leg from 0.382 to 0.786 Fibonacci levels. And the price targets can be as below:
Potential reversal or buying zone: $242.32 to $167.94
Fibonacci projection or sell zone: $300.84 to $441.41
Even though the price action has strong resistance of 100 moving average on the daily chart. But it has also the support of $225 support level and after hitting the support of the channel that has been formed on the daily chart the movement up to the resistance is still due. Therefore we can expect that the price action can move up to the resistance of the channel at least. However, on the monthly chart, a big bullish Gartley pattern is showing that the Bitcoin cash will start a long-term bullish rally soon.