Bitcoin Cash (BCH) is a cryptocurrency that was created in 2017 as a result of a hard fork from the original Bitcoin (BTC) blockchain. The main difference between the two is that BCH has a larger block size limit, which allows for faster and cheaper transactions. Since its inception, BCH has been a popular choice among cryptocurrency enthusiasts and investors alike. In this article, we will discuss the crucial breakout resistance level of $120 for BCH and why it is important to understand.
What is a Breakout Resistance Level?
A breakout resistance level is a price point at which an asset, in this case, BCH, faces significant resistance from sellers. This means that there are many traders who are willing to sell their BCH at this price point, which makes it difficult for the price to rise above it. If the price manages to break through this level, it is considered a bullish signal, indicating that there is strong buying pressure and that the price may continue to rise.
Why is $120 a Crucial Breakout Resistance Level for BCH?
$120 is a crucial breakout resistance level for BCH because it has been a significant price point for the cryptocurrency in the past. In November 2018, BCH experienced a hard fork that resulted in the creation of two new cryptocurrencies, Bitcoin SV (BSV) and Bitcoin ABC (BCH). At the time of the fork, BCH was trading at around $400. However, after the fork, the price of BCH plummeted to around $120, which became a crucial support level for the cryptocurrency.
Since then, BCH has struggled to break above this level. In May 2019, the price briefly rose above $400 but quickly fell back down to around $120. In February 2020, the price once again rose above $400 but was unable to sustain this level and fell back down to around $120.
What Does This Mean for Investors?
For investors, understanding the crucial breakout resistance level of $120 for BCH is important because it can help them make informed decisions about when to buy or sell the cryptocurrency. If the price manages to break above this level, it could be a bullish signal, indicating that there is strong buying pressure and that the price may continue to rise. On the other hand, if the price fails to break above this level, it could be a bearish signal, indicating that there is strong selling pressure and that the price may continue to fall.
It is also important to note that cryptocurrency markets are highly volatile and unpredictable. While technical analysis can provide valuable insights into market trends and price movements, it is not a guarantee of future performance. Investors should always do their own research and consult with a financial advisor before making any investment decisions.
In conclusion, understanding the crucial breakout resistance level of $120 for BCH is important for investors who are interested in trading this cryptocurrency. By keeping an eye on this level and monitoring market trends, investors can make informed decisions about when to buy or sell BCH. However, it is important to remember that cryptocurrency markets are highly volatile and unpredictable, and investors should always do their own research and consult with a financial advisor before making any investment decisions.
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