- Ethereum continues to show malaise
- Downtrend in crypto overall
- Heading towards $100 support level
Ethereum continues to show a significant amount of malaise as it simply can’t go anywhere. Looking at the chart, it has been drifting lower for some time which coincides quite nicely with the overall cryptocurrency markets that simply can’t get a boost these days. With that being the case, it’s not a surprise to see this market drifting below the $150 level. Ethereum tends to be the “little brother” of other cryptocurrencies such as Bitcoin. As long as Bitcoin struggles, Ethereum won’t do much better.
Crypto in downtrend
Crypto markets have been in a downtrend for several months. Bitcoin simply cannot find adoption and is far too volatile to be used as currency. That only leaves speculators and it has recently come out that the amount of Bitcoin holders out there is relatively small when it comes to the larger amounts. If that’s the case, then this is a market that will remain very dangerous.
Bitcoin simply cannot find adoption and is far too volatile to be used as currency
As such, the “little brother” of course won’t fare very well. Looking at Ethereum you can see that the 50 day moving average, painted in red on the chart, has been dynamic resistance for some time. The 200 day EMA, painted in blue on the chart, is also well above current pricing, suggesting that the $200 level will not only be interesting due to the fact that it is a large, round, psychologically significant figure, but also due to the fact that the 200 day EMA is sitting there, it will be massive in its ability to cause resistance.
Heading towards $100 support level
Ethereum looks likely to be heading towards the $100 support level, the scene of the most recent uptrend. It has been a slow and steady descent to that level, so that is much more likely to be sustainable as a downtrend, as it hasn’t been impulsive.
It is a simple lack of desire to own Ethereum that has been causing so many issues. We have seen this not only here, but also in the Bitcoin market, the Ripple market, and so many others.
Previously, once we tested the $100 level the market bounced rather significantly. It is because of that that a technical analysis driven trader will expect to see some support in that area. Not exactly a stretch considering it is such a large, round, psychologically significant figure. In the short term, it looks as if rallies will continue to be sold, as there is simply no reason to think that things are going to change in the short term. Central banks around the world continue to be very loose with their monetary policy and even Bitcoin can’t pick itself up off the floor. In that scenario, Ethereum stands no real chance to gain, and as a result it remains a short or perhaps something that you may wish to look towards at lower levels in the future.