simply put

  • In June 2023, after the U.S. Securities and Exchange Commission (SEC) designated several large altcoins as “securities,” Bitcoin Cash (BCH) became one of the biggest winners.

  • The BCH relative strength index (RSI) has fallen below the 70 level, indicating that selling pressure is increasing.

  • A large group of institutional investors that led the BCH price rally sold 100,000 BCH in July.

Bitcoin (BCH) has been one of the biggest winners in June, rising 150% after the SEC classified several large altcoins as “securities.” However, Ripple’s (XRP) recent victory over the U.S. Securities and Exchange Commission (SEC) may now put Bitcoin Cash’s price gains at risk.

In June 2023, Bitcoin Cash (BCH) surged 150% in price as institutional investors turned to Proof of Work (POW) altcoins amid concerns about the SEC suing the famous Proof of Stake (PoS) protocol.

BCH price gains have cooled in July since hitting a 2023 peak of $320 on June 30. XRP’s victory over the SEC could lead investors to reallocate funds to troubled PoS altcoins, which have taken a hit in price recently, such as Cardano (ADA) and Algorand (ALGO), which have both seen price increases since the recent ruling in favor of Ripple.

Additionally, major exchanges have begun to relist XRP following the positive news, which could further benefit other cryptocurrencies that have been labeled as securities.

Selling pressure grows among Bitcoin Cash investors

Bitcoin Cash is down 15% since July 1. Base price data shows BCH investors expect tough times ahead.

According to the Relative Strength Index data, BCH is expected to set a series of new lows in the coming days. As shown above, after soaring to euphoric highs in late June, the BCH RSI has fallen below the key 70 mark, hitting 66.03 at the close of July 13.

The Relative Strength Index assesses the strength and momentum of a price trend. When the RSI crosses below the 70 level from above, it indicates that selling pressure is increasing,

Strategic traders may interpret this as a signal to take bearish BCH positions in the coming days.

Price-savvy whales are making massive withdrawals

Additionally, a group of price-savvy crypto whales have begun selling off their Bitcoin Cash holdings. Whales holding between 1 million and 10 million BCH have reduced their balances by 100,000 BCH since early July.

At the current market price of $275, whales have withdrawn more than $27.5 million from Bitcoin Cash as of mid-month.

The chart above shows that the BCH price initially started to climb when this group of whales began buying around June 18. Therefore, their current selling spree could also have a serious impact, posing a risk to Bitcoin Cash price increases.

XRP’s victory has clearly sparked an improvement in market sentiment around the troubled mega-altcoin. This could encourage investors to pull more funds out of BCH and reallocate those funds to under-buyed and recovering tokens.

BCH Price Prediction: Reversal to $200 Imminent?

Considering the key bearish indicators highlighted above, it looks like BCH price will reverse towards the $200 range. But the bears must first break through the buy wall around $250.

IntoTheBlock’s GIOM data shows that 513,220 investors bought 1.69 million BCH coins at a maximum price of $253. Once the Bitcoin Cash price approaches $250, they may desperately start buying more Bitcoin Cash to cover their long positions.

But if their reserves run low, BCH could slide towards $200 as predicted.

Still, if BCH can break above $300 again, the bulls could still regain control. But as shown above, the $286 resistance level might be difficult to break. Around this area, 1.39 million addresses hold 2.58 million BCH at an average price of $286.

Considering the growing bearish momentum, these holders can close their positions once they break even. However, if this resistance level fails, BCH price could rise to $300 again.