Bitcoin Cash Price Analysis–Sep 27
Thanks to yesterday’s 20 percent surge, Bitcoin Cash prices are now trading above $500 after adding $2 billion. Analysts are attributing this to Bitmain’s successful IPO filing and as optimism reign, bulls are direct benefactors.
Latest Bitcoin Cash News
Bitmain Technologies and Jihan Wu, the co-founder of the billion-dollar company preparing to file for an Initial Public Offering at the Hong Kong Stock Exchange are on focus. It’s easy to see why. First, Bitmain is racking in billions and it has been around for less than half a decade. The company is also the face of Bitcoin, Bitcoin Cash and most mineable cryptocurrencies that depend on their application specific integrated circuits (ASICs) for network security and transaction confirmations.
Jihan Wu, on the other hand, is the man attributed for guiding the company to where it is. At 32 years, the man is a billionaire a few times over. Now that Bitmain is filling for an IPO, the company financial stand is open for public scrutiny.
Going through their financials, the company that owned 1.2 million Bitcoin Cash by Dec 2017, controls more than 75 percent of the manufacture of mining gear. That means it’s a monopoly as revenue and profitability shows. In the first half of the year, the company turned in $740 million in profit from a $2.2 billion revenue. If the filling goes on as planned, Bitcoin Cash-which the company supports-will definitely soar.
At the moment, there is a war in Bitcoin Cash and as they prepare to fork, Bitmain is supporting Bitcoin ABC’s radical plans of introducing canonical transaction ordering (CTOR) and removing block size limits. CTOR has been proven not to support zero-config and its introduction will involve changes on the underlying code. Apart from Bitcoin ABC, Jihan Wu supports Worm Protocol (a fork from Omni Layer), a proposal introducing smart contracting capabilities on Bitcoin Cash network.
Bitcoin Cash Price Analysis
Historically, it’s hard for any trading asset to persistently rise or fall one way, over a long period of time. Relaying the same analogy to Bitcoin Cash price action and it’s easy to see why a reversal is inevitable.
When we place a simple Fibonacci retracement tool between its high-low, it shows that prices are down 95 percent from its highs. That’s below the lower limit of 78.6 percent retracement level meaning even if prices soar, it’s unlikely that the $4000 price tag would be reached anytime soon. In fact, the best bulls can muster is $2,500 and $3,000 zone marked by the 23.6 percent and 38.2 percent retracement levels regardless of consensus on a hard fork or Bitmain successful filing.
Though we are trading within a bear break out pattern of week ending Aug 12 which was again confirmed by week ending Sep 9, pure sentiment-not technicals are lifting price. As such, we recommend small lot buys with first targets at $600 and later $850.
Any strong surge above $600, a break out level, ushers in conservative, risk-on traders aiming for $850.
A 20 percent spike of Bitcoin Cash prices saw bulls trading above last week’s highs triggering buys in the process. Another noteworthy development is the surge of buy trading volume following the announcement.
Simply because of this rejection of lower lows—thanks high trading volumes setting trends, we recommend buying on dips at spot prices with stops at $470 and first targets as mentioned above.
Disclaimer: Views and opinions expressed are those of the author and aren’t investment advice. Trading of any form involves risk and so do your due diligence before making a trading decision.