- Bitcoin Cash has a bullish short-term and bearish medium-term trading bias
- The four-hour time frame shows that a bullish inverted head and shoulders pattern is forming
- The daily time frame shows that the cryptocurrency may start to target the $280 level
Bitcoin Cash is showing bullish bias as the fifth-largest cryptocurrency continues to firm above the technically important $200 level.
Technical analysis highlights that if bulls can rally the cryptocurrency above the $225 level, then the BCH/USD pair could continue its advance towards the $280 level.The BCH/USD pair has staged a strong recovery from the worst levels of the month, with the cryptocurrency gaining over 25% since Dec. 18.
At current levels, Bitcoin Cash looks to close the month of December basically flat, although it will finish 2019 with a gain of just under 35%.
The four-hour time frame shows that the BCH/USD pair has turned technically bullish for the first time since mid-November. Furthermore, a bullish inverted head and shoulders pattern will form if bulls can rally price towards the $225 level.
The size of the pattern suggests that the BCH/USD could rally towards the $270 level if bulls ignite the bullish pattern. The daily time frame shows that short and medium-term analysis is aligning well, with major trendline resistance located around the $225.
Looking more closely at the daily time frame, major upsloping trendline resistance, and the BCH/USD pair’s 200-day moving average, is offering dual resistance around the $280 level. Technical indicators are also turning bullish over the medium-term, with the Relative Strength Index now offering a strong buy signal.
BCH/USD 4H by TradingView
Upside Potential
BCH/USD daily by TradingView
The four-hour time frame shows that key technical resistance is now located at the $215 and $225 levels. Key technical resistance over the medium-term is located at the $270 and $280 levels.
Downside Potential
The four-hour time frame is showing that the BCH/USD pair has strong long-term technical support around the $200 and $190 levels.
A reversal from current levels and sustained weakness under the $170 level will leave the BCH/USD pair exposed to additional losses towards the $150 level.
Summary
Bitcoin cash has staged an impressive reversal from the worst levels of December, with bulls now targeting the $225 level. Overall, a breakout above the $225 level should confirm a major upside rally towards the $270 to $280 technical region.
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