The remarkable 75% surge in the price of Bitcoin Cash (BCH) within a week, accompanied by an inflow of $1.2 billion in trading volume, has sparked much interest among investors. The recent listing of BCH on the EDX exchange, a trading platform supported by financial institutions like Fidelity, Schwab, and Citadel, is thought to be the primary driver behind this impressive upward trend.
An intriguing aspect of Bitcoin Cash’s rapid growth is the 77% increase in open interest, reaching a nine-month high of $135 million. This growth signals a change in sentiment towards BCH due to expectations of potential institutional adoption after being listed on EDX. While BCH emerged from the original Bitcoin blockchain in July 2017, it has yet to achieve the same level of widespread adoption as a payment network.
Despite a record $129 million of Bitcoin Cash transactions valued above $100,000 in the past week, it pales in comparison to the $75 billion worth of transactions processed by Bitcoin in the same period. Nevertheless, rising open interest suggests optimism about Bitcoin Cash’s future, particularly regarding institutional adoption, which could positively impact liquidity, market demand, and overall value.
BCH has experienced a significant breakthrough above the double top resistance level at $120, and a strong upward trend surpassing the $163.17 mark, supported by the 23.6% Fibonacci level. Although the price has surged towards the key resistance level of $200, it is currently in the overbought zone, according to the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) indicators on the daily timeframe. This implies that the bullish momentum might soon exhaust itself, providing an opportunity for sellers to profit from potential corrections below the $150 level, with target support at $130 and $120.
Conversely, a decisive break above $150 could push Bitcoin Cash to new highs at $161 or $172. Investors should keenly observe the price action around the pivotal $150 level since it holds significant influence over BTC’s short-term trajectory.
It is important to mention that BCH is not currently on track to reach the $1,000 mark in 2023. Therefore, focusing on immediate price levels and key support/resistance areas becomes even more critical. As traders and investors, staying informed about the latest market developments and employing suitable risk management strategies is strongly recommended in navigating the fast-paced world of cryptocurrencies.
Source: Cryptonews
