Why Bitcoin Cash [BCH] investors shouldn’t expect profits anytime soon

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The mar­ket cap­i­tal­iza­tion of the entire cryp­tocur­ren­cy mar­ket has declined by about 5% since the month start­ed. The cur­rent as of 27 August stands at $944.9 billion. 

More­over, the gen­er­al mar­ket decline has led lead­ing coins like Bit­coin [BTC] and Ethereum [ETH] to post dou­ble-dig­it declines in the last 26 days. Shar­ing a sig­nif­i­cant pos­i­tive cor­re­la­tion with BTC, Bit­coin Cash [BCH] has been impact­ed by the gen­er­al mar­ket downturn.

Good times haven’t lasted

As of 15 August, BCH trad­ed at $145.92, hav­ing grown by 40% 30 days pri­or. As of this writ­ing, the alt­coin exchanged hands at an index price of $117.05, post­ing a 24% decline in the last 12 days. 

In the last 24 hours, the coin had dropped by 8%, data from Coin­Mar­ket­Cap revealed. Although trad­ing vol­ume was up by 42% with­in the same peri­od, the dis­par­i­ty between price action and trad­ing activ­i­ty indi­cates buyer’s exhaus­tion. This may occa­sion a fur­ther price drawdown. 

The read­ings of BCH’s price move­ments on a dai­ly chart did not tell a good tale either. Since 19 August, investors have grad­u­al­ly reduced their BCH hold­ings. The uptick in coin dis­tri­b­u­tion sent key indi­ca­tors – Rel­a­tive Strength Index (RSI), Mon­ey Flow Index (MFI), and Chaikin Mon­key Flow (CMF)- below their respec­tive neu­tral spots. 

As of this writ­ing, the RSI was 40. The coin’s MFI was 39, while its CMF was ‑0.20. A read­ing of the posi­tions occu­pied by these indi­ca­tors was that buy­ing pres­sure for the BCH token had dropped in the past few days.

Source: Trad­ingView

On-chain performance

The count of unique address­es that have trad­ed BCH coins has declined since 15 August. Accord­ing to San­ti­ment, dai­ly active address­es on the BCH net­work stood at 16,400 address­es at press time. It fell by over 71% decline in the last 12 days. 

As for trans­ac­tion vol­ume on the net­work, this also dropped by over 50% with­in the same peri­od. Rep­re­sent­ed in USD, BCH’s trans­ac­tion vol­ume has fall­en from $93.79 mil­lion to $9.63 mil­lion in less than 15 days.

Source: San­ti­ment

While the price per BCH coin has dropped in the peri­od under review, as for min­ing on the net­work, rewards received by min­ers from trans­ac­tion fees and the block sub­sidy since 15 August have grown by 10%. 

Source: IntoThe­Block

As for the ratio of BCH investors in prof­it in the last month, the 30-day Mar­ket Val­ue Real­ized Val­ue (MVRV) post­ed a neg­a­tive ‑16.58. On a 365-day aver­age, this met­ric also logged a neg­a­tive val­ue of ‑51.21. This showed that many BCH investors are yet to turn a prof­it since last year.

Source: San­ti­ment

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