As Bitcoin (BTC) is looking to roll over into a continuation of its downtrend, Ethereum (ETH) likewise is looking to take another trip down after looking weak on the indicators — and getting stuck at a very important resistance level.
We start with a daily ETH/BTC chart, and see that Ethereum has been unable to climb back above the local market resistance in red. This resistance is not far from the limit where Ethereum, earlier this year, “capitulated” into price territory not seen since March of 2017 (shown below).
A lower high in the price action (B) is signalling another probable leg down. Mostly sell volume yesterday was on the rise. Price is likely to take out the previous low (A) and find support within the blue box, at least initially.
On an identical daily chart with indicators, we see that a major bear divergence has forecasted a move down, and that the histogram is rolling over for a deeper dive into negative territory. We also see the aforementioned 2017 resistance level, which marks a very important point in ETH’s complete market structure.
Ethereum’s last uptrend got pretty close to this level, but it seems that another consolidation cycle will probably have to go process before it can be retaken, or even attempted again.
Moving to the daily ETH/USD chart, things don’t look much better. Ethereum is getting double-throttled with each Bitcoin movement: falling on ETH/BTC when Bitcoin falls and vice-versa, causing a wild ETH/USD price action.
With Bitcoin falling at time of writing, we could see the leading altcoin slice clean through the “golden pocket” Fibonacci retracement zone at about 0.618-65 and down to likely strong support above $150. This figure is based on an important inflection zone from the beginning of 2019, when ETH first broke out to grab significant gains.
Finally, if we look on the 4-hour ETH/USD chart, we see that the present selloff is likely to cool off soon. Oversold conditions on the RSI are starting, and the histogram is starting to arch down at an extreme rate.
But, sell volume on the (Bitcoin-caused) move down is starting to dissipate, which may signal a mini consolidation above $170.
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