Bitcoin Cash Tests Monthly High at $585 as ADX Signals Trending Conditions Emerge
Market Structure Shifts Higher
- 52% increase in BCH value over the past month.
- Price jumped from $818 to $1,250 since May 14, surpassing 2017 highs.
- Key resistance zones at $957 and $1,073.66 have been held.
In the past month, BCH has seen an impressive 52% increase in value. This has especially been the case since May 14, as many have noted the uptrend which has seen the price jump from $818 to $1,250 as of May 23. With the 2017 highs at $966 and this consolidation of the peak, Bitcoin Cash seems to be in price discovery once again. With this latest rally, BCH has cemented and held the key zones of resistance at $957 and $1,073.66.
Bitcoin Cash has seen a strong rebound, rising 52% in the last month to test resistance at $585. It has moved out of the consolidation range inscribed in October and taken out several key resistance levels that kept upside progress restricted over the autumn months. The burning issue for traders is whether BCH can keep the upgrade over the psychological $600 imprint or if the uptrend will soon be exhausted with a potential pullback after such a lengthy winning streak.
| Metric | Value |
|---|---|
| Asset | BITCOIN CASH (BCH) |
| Current Price | $585.28 |
| Weekly Performance | 10.96% |
| Monthly Performance | 9.05% |
| RSI (Relative Strength Index) | 60.5 |
| ADX (Average Directional Index) | 18.9 |
| MACD (MACD Level) | 10.47 |
| CCI (Commodity Channel Index, 20-period) | 159.09 |
Momentum Resets to 61.66 After Testing Overbought Territory
The Relative Strength Index is at 61.66 on the daily time frame. It has pulled back from recent highs around 70 but is holding bullish above the key 50 level. This controlled easing implies normal profits taken rather than exhaustion. Bulls remain firmly in the driving seat, despite the small step back from overbought. A 15% additional rally followed similar RSI readings in September, but not before a deeper drop into the mid-50s first.
Therefore, another attempt at reclaiming that $600-$620 zone is quite justified to gain more momentum and potentially establish this as a new support level — assuming broader market winds remain reasonably favorable. That’d also improve the chances of slicing through $640-$650 when revisiting them, assuming they angle much higher than $700.
ADX at 18.89 Confirms Shift From Chop to Early Trending Phase
At ADX reading of 18.89 BCH is about to leave behind the choppy, directionless action that prevailed throughout October and enter a trending environment. Generally speaking, while in this region we can expect a drop in volatility and an increase in directional movement – which is exactly what trend followers thrive on. The move from single-digit ADX readings just a few weeks back replicates the behavior prior to BCH’s summer rally from $380 to $500.
Simply put, the ADX is a signal that we’re transitioning from a horizontal market to a trending market, but we’re not seeing the extreme readings over 25 that tell us a trend is well established. As such, day traders will want to adapt their approach to the situation, and what worked in terms of trading the range during October’s consolidation will likely lead to lagging performance as a stronger trend takes shape. The fears related to the SBI attack did nothing to stop this technical change in character, as measures of trend strength aren’t listening to the fundamentals.
50-Day EMA at $529 Transforms From Resistance to Critical Support
The 10-day average is also on the verge of making a bullish cross up through the 20-day EMA, confirming the short-term upside bias. Farther to the upside, resistance levels are marked at the weekly high of $582, $600, $635, and the September high around $650. Support levels are highlighted at the 20-day EMA ($532), the 10-day EMA ($543) on a retest, and the pre-breakout consolidation area of the former pennant top ($520).
When it comes to the shorter-term, we will mostly be using the 4-hour chart. Here we see the price action in an ascending channel between $529 and $560. This is a textbook bearish channel but those often morph into bull flags if the bulls remain above 70 in the 4-hr RSI and below 60 in the 4-hr Stoch RSI.
Resistance Stacks Between December Highs at $600 and Monthly R1 at $639
There is notable support at $525-$530 based on the prior breakout level and last week’s breakout gap. This is also a logical area for the rising 5-day moving average (5DMA) to come in when price encounters its first pullback. Given how far above it prices are, it’s not unreasonable to assume that in a bull cycle, that is where the first supports will materialize.
Bulls are in a comfortable position and should take this opportunity to build support by developing price sideways. Initial resistance will be met at the confluence of the monthly pivot and the prior range top at $612. Follow-up offers will likely emerge once the monthly R1 at $665 is overcome, targeting the highs.
The market structure implies buyer’s power as long as they can hold $529 above in any retest. Volume patterns remain indicative of accumulation on the 50 EMA dips and distribution on $600 tests – classic uptrending behavior. This is the same setup we saw playing out during the coiling process before July’s parabolic expansion; however, the momentum oscillators are reflecting more of a stair-stepping uptrend this time around.
Bulls Need Daily Close Above $600 to Unlock Path to $639 Target
For the uptrend to further establish itself, the RSI must stop cooling off above the 50 midline and start upticking toward 70. The market may reach this level sooner than the oscillator as overhead supply weakens, making clearing crucial resistances a lighter lift for buyers. It also encourages waning sellers to offload fewer coins. A strategy that empowers bulls to resume leading the charge.
If BCH hard rejects at $600+, breaking down below $529 on volume, then that will give us the bearish blockade we’re looking for. This will trap breakout buyers over the past two weeks and flush us down into the $485-510 zone. The 50-day EMA and ADX rolling over sub 15 would give us our bearish bias confirmation. This would also signal that the latest trend attempt has failed and that range conditions are likely.
Based on the current set-up and the market’s willingness to brush off October’s security fears, the most likely short-term trajectory has BCH ranging between $560-600 before making a second break at monthly tops. Re-set momentum, increasing trend dynamics, and a healthy cushion of support imply that pull-backs are still to be used as entries unless $529 is violated.
