Bitcoin Cash (BCH) faced a 5% decline in its price following the escalating withdrawals of Mt. Gox creditors on the Kraken exchange. As the assets from Mt. Gox were successfully distributed to the victims, Kraken began disbursing them back to the creditors. This resulted in creditors withdrawing their BCH and BTC from Kraken, putting selling pressure on the BCH price. Additionally, Mt. Gox transferred more BTC to the Bitstamp exchange, which could further impact market prices. As a result, BCH price dropped 5% in the last 24 hours to $368.
Despite the recent decline, there are signs of a potential bullish reversal for BCH. The price is completing the right shoulder of an inverse head-and-shoulders pattern, suggesting a possible upward trend. If the price breaks above the neckline at $395, it could lead to a 41% surge to the next major resistance around $529.
However, there are also potential obstacles on the way up. The $395 level, which coincides with the 50-day and 200-day EMAs, may act as resistance. On the downside, support levels exist around $360 and $300, where the price has previously bounced back.
Technical indicators show that the relative strength index (RSI) is at 46.44 and just crossed below its 14-day simple moving average (SMA), indicating a reduction in bullish momentum. Additionally, BCH trading volume has decreased by 19% in the last 24 hours, indicating reduced buying interest.
Nevertheless, the volume on the formation of the right shoulder has increased, indicating potential accumulation and a possible upcoming breakout. Overall, for BCH to break to the upside, there needs to be a positive and significant change in buying pressure.
In positive news, the Mt. Gox repayment program for hack victims is progressing well. Kraken and Bitstamp are among the exchanges being used to reimburse creditors, and users have reported successful withdrawals of Bitcoin. This indicates accountability from Mt. Gox and Kraken, which is a positive sign for the crypto market.
To summarize, the recent decline in BCH price can be attributed to the withdrawals of Mt. Gox creditors on Kraken. However, there are indications of a potential bullish reversal, with a target of a 41% rally to $529.