Ethereum has formed lower highs and lower lows to trade inside a descending channel on its 1-hour time frame. Price found support at the bottom and looks ready to test resistance again.
Applying the Fibonacci retracement tool shows that the 61.8% level lines up with the channel top around $300. This is also just below the 100 SMA dynamic inflection point, which might also keep gains in check. If so, Ethereum could fall back to the swing low at $250 next.
The 100 SMA is below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. In other words, the selloff is more likely to resume than to reverse. The gap between the moving averages is also widening to reflect stronger selling pressure.
RSI is on the move up but nearing overbought territory to indicate that buyers are in control but could lose momentum soon. Stochastic is also dipping into overbought territory to reflect exhaustion among bulls. Turning lower could bring sellers back in, even before price hits the top of the channel.
Ethereum broke below a key support zone, likely drawing even more selling pressure as investors rush to liquidate positions even before finding out what’s driving the move. There appear to be no catalysts for the sudden drop, at least based on the headlines, but mostly sentiment-based trading.
Traders have a weaker appetite for riskier assets these days on account of the crisis in Turkey that is feared to spark contagion to European banks and the global economy. However, cryptocurrencies have shown a tendency to do well when these situations persist, especially once investors start moving funds out of traditional markets that are more susceptible to a financial crisis.
If this phenomenon takes over, Ethereum could have a shot at busting out of the channel and starting a reversal. It would help, though, if this was also supported by positive developments in the industry itself.
This is a preview of a research report from Business Insider Intelligence . To learn more about Business Insider Intelligence,… Read More
New York, NY 16 Sep 2019: – According to a new study published by Polaris Market Research the global blockchain… Read More
(Image: Stockfresh) Pro 16 September 2019 | 0Research firm Gartner, whose past evaluations of blockchain have been conservative to say… Read More
Bill Barhydt, CEO of Bitcoin investment platform Abra , claims that Facebook staffers told him the company wanted to use… Read More
Bitcoin and crypto investors were put on notice this week when French and German government officials backed European Central Bank… Read More