- Bitcoin Cash has formed a sell signal on its MACD indicator, which could cause a price drop to $365.
- Despite the bearish trends, traders on Binance are betting on further price increases.
Bitcoin cash [BCH] was up slightly by 0.1% to trade at $430 at the time of writing. Despite these gains, the altcoin is down 6.5% over the past seven days, reflecting a bearish trend in the broader cryptocurrency market.
On the charts, bears continued to control BCH’s price action, as evidenced by the Moving Average Convergence Divergence (MACD) indicator. The histogram bars and MACD line were negative, indicating bearish momentum.
The crossover of the MACD line below the signal line has also formed another sell signal. Historically, this sell signal has led to a sharp decline for BCH.
Source: TradingView
A strong support level for Bitcoin Cash lies in the lower Bollinger band, at $417. If the altcoin breaks this support, it could trigger a decline to the 1.618 Fibonacci level at $365.
Important resistance level to keep an eye on
The In/Out of the Money Around Price (IOMAP) indicator shows a crucial resistance level for BCH between $432 and $445.
More than 429,000 addresses purchased the token at this price level, and if they choose to minimize their losses, this could increase pressure on the sell side.
Source: IntoTheBlock
Given the intensity of losses in this supply area, buyers could view this as an unfavorable entry point that would hinder any potential upside.
Traders are increasing their bullish bets
Traders on Binance are bullish on Bitcoin Cash despite the negative outlook on the one-day chart. The percentage of traders who have taken long positions on BCH has increased to 71%, while short traders are 28%.
Source: Coinglass
The large number of traders with long positions suggests a consensus that BCH could secure gains. However, these positions may be subject to liquidations if another price decline occurs, increasing selling pressure.
One factor driving demand for long positions is a decline in financing rates to 0.0076% per Coinglass. This indicates that traders are paying less to maintain their open positions.
Read the one from Bitcoin Cash [BCH] Price forecast 2024–2025
The one-day chart of Bitcoin Cash shows predominantly bearish trends. Furthermore, a sell signal on the MACD could put more downward pressure on the price, causing the token to fall further.
The bullish bias on the Long/Short ratio points towards positive market sentiment. However, this does not bode well for the price, if a decline triggers forced long-term liquidations resulting in selling activity.
