Bitcoin Cash recovery faces a hurdle at $222

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

• BCH dropped below $200; a two-month low last seen in June.
• The derivatives side was firmly bearish at the time of publication.

Last week’s (14 – 20 August) crypto slump eased over the weekend. Most assets posted double-digit losses over the past week. In particular, Bitcoin [BTC] dropped by 11% per CoinMarketCap’s seven-day performance. Bitcoin Cash [BCH] plunged 18% over the same period. 

Is your portfolio green? Check out the BCH Profit Calculator 

BCH’s drop saw it breach below the $200 psychological level; a two-month low last seen in June. But there was a positive price reaction near $180, but a crucial roadblock lies ahead.

BCH fails to clear the recent lower low at $200

Source: BCH/USDT on TradingView

BCH has been making lower lows since July, capturing the altcoin’s downtrend in Q3. But it was worth noting that the previous support zone of $221 – $235 eased the drop for a while. The support cracked on 16 August, tipping sellers to extend gains below $200.

The drop eased to $180, but a recovery attempt was thwarted at $200. So, bulls must clear the $200 and $222 roadblocks to continue reversing the recent losses. But BTC struggled to keep hold of $26k, which could further delay BCH bulls from clearing the overhead hurdles. 

Conversely, sellers could push BCH lower to $158 if BTC’s weakening persists. 

Meanwhile, the On Balance Volume (OBV) improved, indicating increased demand. But the CMF (Chaikin Money Flow) stalled the zero mark; denoting eased capital inflows. 

Besides, the Relative Strength Index retreated from the oversold zone, indicating increased buying pressure. But it was yet to cross above the 50-mark to confirm extra buyers’ leverage. 

Realistic or not, here’s BCH’s market cap in BTC terms

The bearish grip on the futures market

Source: Coinalyze

The bearish grip seen last week was still prevalent in the futures market at the time of writing. For example, the Open Interest rates fell from over $280 million to <$200 million between 15 – 18 August. After that, it was flat, denoting a decline in demand followed by stagnation. 

Similarly, the CVD (Cumulative Volume Delta) declined, and funding rates were negative, demonstrating the sellers’ edge and bearish bias in the derivatives market.