Bitcoin Cash (BCH) is under growing bearish pressure, as on-chain analysis indicates that the cryptocurrency's price support level of $150 could be at risk. Data from IntoTheBlock shows that as of Wednesday, the cumulative Bitcoin Cash balances in recognized Miners' Reserve wallets have dropped to 5.9 million BCH, the lowest in five years.
This decline in miner reserves comes after BCH miners significantly offloaded their holdings following a peak in the cryptocurrency's price. On June 30, 2023, Bitcoin Cash's price reclaimed $300, a significant increase after spending 14 months below this mark. Miners took advantage of this rally to sell off their reserves at favorable prices. At the time of the peak, miners held 7.16 million BCH coins. However, as of Wednesday, only 5.99 million BCH remains in their cumulative balances, indicating a decline of 1.17 million coins.
This drop in miner reserves equates to an offload of coins worth $225 million since June 30, benchmarked against current market prices. The selling pressure from miners initially accelerated when the BCH price broke above $140 on June 21. With BCH currently trading around $192, miners still consider these prices favorable and are likely to continue selling until the Bitcoin Cash price retraces below $150.
In addition to the decline in miner reserves, there has been a worrying trend of decreasing whale transactions over the past three months. Data from Santiment shows that peak whale activity on the Bitcoin Cash network has been steadily declining from 650 transactions in June to only 279 transactions in August.
Whale transactions refer to confirmed trades exceeding $100,000 during a given period. A decline in such activity sends a bearish signal to other investors and reduces market liquidity, potentially forcing some traders to lower prices to fulfill trades efficiently.
The combination of miners cashing out and declining whale activity could trigger a bearish reversal for Bitcoin Cash below $150. However, potential challenges for bears lie around the $170 territory. There are currently 114,750 addresses that bought 391,300 BCH at a minimum price of $173. If these holders defend their positions, it could trigger a rebound.
On the other hand, if bearish miners continue selling, the Bitcoin Cash price could drop toward $150. Conversely, bulls could invalidate this pessimistic prediction by reclaiming $250. However, this scenario seems unlikely under current on-chain circumstances as there are 60,120 addresses that bought 1.5 million BCH coins at an average price of $220 and they might choose to sell at that level.
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