The surge of Bitcoin Cash: analysis of the recent 21% increase

Bitcoin Cash (BCH) has recorded an impressive growth of 21%, leading analysts and investors to question the sustainability of this trend. 

At the time of writing, the price of BCH stands at 387 dollars, approaching the significant psychological level of 400 dollars. The question everyone is asking is: will this growth continue, or will we witness a retracement?

Technical analysis of Bitcoin Cash (BCH) price

The recent performance of Bitcoin Cash has shown some key signals that deserve a detailed analysis. A daily close above 351 dollars could indicate a structural bull market change. 

This price movement is supported by an increase in demand and a parallel rise of Bitcoin (BTC), with which BCH shows a correlation of +0.71.

Main resistance and support zones for the price of Bitcoin Cash (BCH)

The price chart of Bitcoin Cash reveals that the area between 414 and 425 dollars represents a significant resistance zone, ideal for evaluating short entries with a good risk-reward ratio. Above this threshold, the resistance extends up to 450 dollars, a psychological level that could hinder further bull advances.

On the contrary, the range between 329 and 342 dollars has seen a high volume of purchases, suggesting that it could act as a solid support in case of pullbacks.

Market factors and trading volume

The correlation of Bitcoin Cash with other criptovalute such as Dogecoin (DOGE) and Chainlink (LINK) has been highlighted, with Bitcoin Cash showing a correlation of +0.8 with these. Additionally, on-chain activity and trading volume have increased, indicating renewed interest and a possible bull conviction among investors.

The social volume, which has remained stable over the last three weeks, has recorded an increase compared to the mid-February decline, while the daily active addresses have grown significantly in the last week.

Future prospects for Bitcoin Cash

Despite the current market structure suggesting a possible bullish reversal, the persistence of a bearish swing structure implies that the area between 414 and 425 dollars remains critical for evaluating potential trading strategies. A convincing break above 452 dollars would invalidate the bearish scenarios, paving the way for new bullish horizons for BCH.

The recent rally of Bitcoin Cash raises interesting questions regarding its ability to maintain these price levels or if the market will witness a correction. 

Investors should closely monitor the mentioned resistance and support areas, as well as keep an eye on trading volumes and on-chain activity to better understand the future direction of BCH’s price. 

The key will be to observe if the daily close exceeds 351 dollars, thus consolidating a bull market structure.