Bitcoin cash (BCH) is pushing higher against the greenback and could test the $1,200 mark soon, according to the technical charts.
As of writing, the world's fourth-largest cryptocurrency by market capitalization is changing hands at $1,119 - up 3 percent on a 24-hour basis, according to data source CoinMarketCap. Prices had dropped to a four-week low of $938 on Friday, tracking the broader market sell-off.
However, over the weekend, BCH moved back above the $1,000 mark, signaling a temporary low is in place at $938.
Also, yesterday's 14 percent rise in BCH was backed by a 38 percent jump in trading volumes, as per CoinMarketCap. A high volume recovery only adds credence to the argument that a short-term bottom has been made.
- BCH has created a bull flag, a bullish continuation pattern, meaning an upside break would signal the continuation of the rally from the Friday's low of $914. BCH could then rise to $1,200 (psychological hurdle) and may extend gains to $1,240 - 161.8 percent Fibonacci extension.
- Bullish crossover between the 50-hour MA (moving average) and 100-hour MA favors further upside in BCH prices.
That said, it is still too early to call a long-term bearish-to-bullish trend change as the cryptocurrency is still stuck inside a falling channel (series of lower highs and lower lows on the price chart).
- BCH looks set to test $1,200 over the next two-three days.
- A daily close (as per UTC) above $1,200 would signal the sell-off from the record highs above $4,000 has ended and the bulls have regained control.
- Meanwhile, a downside break of the bull flag would neutralize the immediate bullish outlook, while a daily close (as per UTC) below $914 (Friday's low) could yield a sell-off to $758.61 (Feb. 6 low).
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