Unfortunately, briefly after I updated my previous post BTC crashed. This has posed a systemic risk in the entire market, and BCH fell extraordinarily hard.
It was this hard, I believe, because many people suffered from long squeeze when their positions from the rally this week became untenable. I myself had to close half to deleverage and reduce risk exposure. I must admit that I was too greedy not to take profit after that much gain.
Needless to say, however, BCH is technically superior to BTC and enjoys some advantage by association compared to many alts. This ensures that the long-term value of BCH is relatively safe.
Considering this, I think a very likely scenarios would be that BCH consolidates before further gains. Why? Because this crash has spread enough FUD to depress the market. Many people have lots of paper gains from the rally that they may want to materialize. On the other hand, there's strong community support, and I believe the insane drops below $2000 were results of liquidation & stop losses positively feed back to each other. It doesn't mean the market believes a that level is legitimate.
On the chart, we can see that on 29 Oct the weekly EMA crossed the monthly EMA and another cross hasn't occurred. Therefore, BCH is still bullish in the long-term. The price touched below the monthly EMA three times between late Nov and early Dec and found support. The most likely scenario is that this time the support is solid.
I believe the mid-term trendline (thick green) could provide some support, while the .618 level ($2950 circa) of the last rally some resistance. If this is confirmed, we may have an ascending triangle before the next breakout.
Nevertheless, there's systemic risk posed by bitcoin. It's currently unusable, and next week there'll be another fork coming. These are risks we must consider before deciding on a trade. I think it's better not to use margin at this point.
Komen
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This is my view on the systemic risk bitcoin poses:
Komen
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wow, people are apparently more bullish than I was. not bad.
Komen
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Appears to be still in the zone. I wonder if there's enough support if btc crashes, I think in 3 days (after another failed fork).
Komen
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BCH has indeed stayed in this zone, which is not a bad thing. I think there's a good chance it'll break out by Friday w/ 5k target.
Komen
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Update: I think volume needs to pick up from here for any meaningful breakout.
On the flip side, watch out if the daily EMA crosses the weekly EMA WHILE we break down the support.
As I'm increasingly convinced that BTC will keep falling, it's interesting to see whether bch will hold. If not, I may consider exiting. We'll know in two days.
Komen
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It appears that BCH is even weaker than bitcoin. Time to bail. It's not going to 5k anytime soon.
Komen
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Almost game over.
Komen
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Seems to be incapable of breaking above the old support. I guess in the best-case scenario, if bitcoin goes to 20k bch can go to 3k.
Komen
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Why is BCH pumping like crazy? Is it because I sold half?
Komen
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Should have sold the other half when it was pumping. Regrets.
I think it's the move (and lots of confusion around) getting into BTC today to get free Bitcoin Segwit2X coins due to hardfork today, which we won't see anything from for weeks or months, in what could very well be a last ditch effort to save BTC from now being around a 100 times the cost to send as Bitcoin Cash. Then the shift will probably be back to Bitcoin Cash on Friday, as BTC tests the lows, and that will most likely pump Bitcoin Cash back up to the moon. At least that's where I'd give the odds. Who knows though. All the best
Zielinsky
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Im all in! I see this consolidation as a good thing as long as btc goes bullish. If Btc turns bearish again it will be disastrous, so i put stop order around 2400usd.
What do you think?
DrJLT
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@Zielinsky, I agree in essence, but while I'm bullish on bch here I'm bearish on btc (see my other post in the first comment).
I think there's a good chance for btc to go back to its long-term channel (from which it deviated right where bch was forked). I just don't see how there could be enough capital to support that type of growth for something that size. If it were to go to 30+k in a few weeks, that would mean a company the size of Apple need to disappear. If it were to go to 1m, that would mean NYSE + Nasdaq all close down => that's how much money needed to keep pumping it. The big boys should know this (or they may be stupid & just by luck bought some btc @ $0.01).
That's why I've exited all but EOS & BCH. EOS because I think it should go to 0.05 ETH by mid 2018 regardless of the short-term trend. BCH because I think it's possible that while btc crashes bch could go up. Another coin I think could be safe is ETH. I was thinking about it two days ago but ultimately put in a low order to buy before going to bed. In the morning it had already gone up 15%.
The time to watch out for would be 28/12 when Segwit2x v2.0 gets forked. I'm almost certain it'll be a failure. This is likely to trigger a bitcoin crash.