Litecoin price has done well as it surged from $50 in August last year to $130 today. Most of these gains happened after Canary filed for a spot LTC ETF, which has higher chances of approval by the Securities and Exchange Commission (SEC). We explore why the forgotten Bitcoin Cash (BCH) may be a better option for now.
Bitcoin Cash price is stuck in a bear market
Litecoin and Bitcoin Cash are almost similar assets in that they are both Bitcoin hard forks that use the same technology.
BCH remains in a bear market as it crashed by about 46% from its highest level in December last year. It has recently formed a death cross pattern, with the 50-day and 200-day Weighted Moving Averages (WMA) flipping each other.
Bitcoin Cash price has formed a bearish flag chart pattern, comprising of a long vertical line and some consolidation. This pattern is often a sign of a bearish continuation.
Therefore, the BCH price may have a strong bearish breakdown in the coming days, with the next point to watch being at $273.4, its lowest level last week and in August last year. This price is about 20% below the current level. The bearish outlook will become invalid if the Bitcoin cash price rises above the resistance at $365.
BCH price chart | Source: TradingView
Why BCH is a better buy than LTC today
Bitcoin Cash’s outlook is bearish for now. However, there are signs that it is a better investment than Litecoin.
That’s because Litecoin has received an ETF applicatio, and analysts anticipate that the Securities and Exchange Commission will approve it. Besides, LTC is similar to Bitcoin, and the SEC does not view it as a security.
The challenge, however, is that market participants have priced in Litecoin’s ETF approval. This means that an approval would lead its price lower, a situation known as buying the rumor, selling the news.
The opportunity for Bitcoin Cash is that it will likely receive an ETF application once Litecoin’s one is approved. Such a move will likely lead to higher prices as investors anticipate its approval over time.
The other opportunity is that the BCH price has formed a double-bottom pattern at $273, and the neckline is at $640. If it works, it means that the coin may rebound by about 87% from the current level and by 92% from its double-bottom point.
