Bitcoin Cash Surges 11% as Volume Spike Confirms Breakout Above Key Resistance
Market Structure Moves Higher
- Bitcoin Cash (BCH) surged 55% over the past six months, outperforming the BGCI’s 21% rise.
- BCH broke resistance and jumped 11.2% to $598.68 on high volume, reclaiming $530 as support.
- Technical indicators (RSI, ADX, EMA) suggest consolidation may end and trend continuation is likely.
Bitcoin Cash (BCH) has emerged as one of the top-performing cryptocurrencies in the large-cap market, with a gain of 55% over the past six months. This compared to a 21% rise in the Bloomberg Galaxy Crypto Index (BGCI) over the same period.
Bitcoin Cash broke through several resistance levels this week and jumped 11.2% to $598.68, as trading volume spiked well above its average levels. I think this was BCH’s best break outing since early October after the GPlus double spend attack led to a dip in prices due to security concerns. The real issue for traders now is whether this momentum can hold above the newly claimed $530 support, or if profit-taking will push it back into a consolidation pattern.
| Metric | Value |
|---|---|
| Asset | BITCOIN CASH (BCH) |
| Current Price | $598.68 |
| Weekly Performance | 13.50% |
| Monthly Performance | 11.55% |
| RSI (Relative Strength Index) | 62.2 |
| ADX (Average Directional Index) | 18.9 |
| MACD (MACD Level) | 11.54 |
| CCI (Commodity Channel Index, 20-period) | 171.62 |
RSI Cools to 63.4 While Bulls Maintain Control Above Key Floor
The Relative Strength Index (RSI) is currently at 63.4 on the daily timeframe. It has almost reached oversold conditions last week with a reading of 81 without taking out the pivotal 50 support. This pullback is reminiscent of September’s consolidation in which RSI dropped from 77 to 58 before Bitcoin Cash (BCH) powered up its subsequent rally. In other words, the oscillator indicates that the bulls booked some gains but did not run for the exits. A good reset that typically comes before more upside action.
What is interesting to note is the reaction of RSI to the increase in volume confirming the breakout. It did not surge higher with price but instead backed off overbought levels. Typically, after a strong advance and overbought reading, such as the last one touched 70 in April 2019, momentum wanes and price often corrects. The recent backing off of RSI allowed the indicator to unwind and set the stage for more upside.
ADX at 18.9 Signals Consolidation Phase Ending as Directional Move Builds
With an ADX of 18.9, the ADX reading suggests that Bitcoin Cash has rather spent the past few weeks in more of an accumulation environment than a trending one. This low reading coincides with the sideways grind between $450-530 that trapped bulls and bears alike throughout the month of November. More so, the ADX is simply letting us know that we are transitioning from a bound environment to a trending one – which is exactly what the volume surge and breakout have validated.
If we look at previous moves throughout BCH’s short history, the material profits tend to come from holding positions during a trend; top and bottom picking in choppy markets is a quick way to get chopped up. From a technical standpoint, we know a move is imminent – most likely to the upside given overall cryptocurrencies market performance. ADX levels below 20 on the daily chart don’t last long in BCH heritage, which historically indicates the coming move is sustainable.
50-Day EMA at $528.99 Flips From Resistance to Critical Support
The 10-day EMA is linearly approaching a bullish cross with the key 50-day which should further support bullish ambitions and likely reverse intraday resistance.
In terms of the structure, recent higher-high closes appear to be the beginning of stronger moves compared to pullback highs because there is an underwhelming response by buyers. But until support breaks in the upper $500s, it’s wise to expect some consolidation in the mid-$600s. A pullback in this area would also target the 50-day EMA, currently at $576.82.
Resistance Clusters Between $639-$721 as December Highs Meet Fibonacci Extensions
If the price of Bitcoincash can surge above that region and flip it into a support level, it will provide a path for the bulls to target $760.26. This will be followed by a spike towards the 200% Fib extension at $791.06. The buyers may encounter minor resistance at the monthly R3 and the 261.8% Fib extension if the rally persists.
The critical zone spans $516-529 where the 50-day EMA overlaps with the weekly pivot and the breakout point from Monday’s gap higher. Below that, the October consolidation range between $455-467 offers a deeper safety net, though any revisit would likely flush leveraged positions.
The current setup is similar to a textbook accumulation-to-markup phase. The six-time tested support at $455 formed a solid base, while the volume-backed breakout above $530 changed market structure quite bullish. If BCH remains above the $528-530 support cluster on any pullback, the technical outlook is in favor of another test of the $640 resistance.
Bulls Need Daily Close Above $640 to Unlock Path Toward $700
If BCH can close above $639.77, the measured move from the $455-598 breakout targets $741, which is just above the monthly R2 resistance. The breakout confirmation news и improving overall market sentiment could be enough of a catalyst to push price action there, particularly if BTC remains in a bullish structure well above $100k.
The price of Bitcoin Cash would have to decline significantly to reach $485, a level that has not traded at since October 8. Case in point, BCH has only closed the week below the 100-day EMA twice in 2021. Nonetheless, should the worst-case scenario transpire, it is a viable descent target.
Considering the technical reset from overbought conditions within uptrend structure, BCH seems primed for consolidation between $570-620 before challenging recent highs. For Bulls, it’s essential to watch how price reacts within the $528-530 demand area on a possible retest – solid demand there validates the breakout and paves the way for a test of $640 resistance next.
