On May 2, the price reached a low of $261 and €234. A sharp increase ensued and the price reached a high of $310 and €275 on May 4.
The price has been decreasing since.
Where will it go next?
Let’s find out!
Bitcoin Cash (BCH): Trends For May 6, 2019
- BCH/USD and BCH/EUR reached a low on May 2.
- A rapid increase took it to a high on May 4.
- It has been trading inside a symmetrical triangle.
- Bearish divergence is developing in the RSI and the MACD.
- There is support near $264 and €237
Symmetrical Triangle
BCH/USD is analyzed at one-hour intervals from May 2 to May 6. This is done in order to trace the current trading pattern. In order to avoid confusion, we will not be using images of the BCH/EUR pair until we address future possible price levels. There, the relevant resistance and support areas will be shown in dollars and euros.
On May 2, Bitcoin Cash reached a high of $261.49. A gradual increase ensued and the price made several higher lows.
Tracing these highs gives us an ascending support line:
On May 4, the price reached a high of $310.0. A rapid decrease was followed by a gradual increase. Bitcoin Cash has made several lower highs in the process.
Tracing these lows gives us a descending resistance line. Together, the resistance and support lines combine to create a symmetrical triangle:
The price is likely to trade inside the confines of this triangle until a decisive move occurs. In order to predict the direction of the move, a look at technical indicators in a longer time-frame is required.
Technical Indicators
The price of BCH on Coinbase is analyzed at two-hour intervals from Apr 28 to May 6 alongside the RSI and the MACD.
They are shown in the graph below:
On May 3, the price made a high of $296.62. After a gradual decrease, it reached the same levels on May 5.
Similarly, the RSI and the MACD made their first highs on May 3. However, they have continued to generate lower values since.
This is known as bearish divergence and often precedes price decreases.
Furthermore, all the candles above $290 have had long upper wicks. This indicates that there is selling pressure in the market.
The use of these indicators suggests that the price will decrease and eventually break down from the triangle.
If it does, where will it find support?
Support Areas
Support areas are created when the price revisits the same level several times. They can provide reversal areas in case a breakout/breakdown occurs.
One support area is shown for BCH/USD (first graph) and another for BCH/EUR (second graph) below:
The closest support area is found near $264 and €237. We believe the price will eventually reach this area.
Summary of Analysis
The price of BCH is likely to decrease, break down from the symmetrical triangle and reach the support area outlined above. Bitcoin Cash may reach levels below $265 and €240.
To read our 2019 and 2020 price predictions for Bitcoin Cash, click on the blue button below:
Do you think Bitcoin Cash will drop to the support area? Let us know your thoughts in the comments below.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
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Disclaimer
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
