Ethereum
Ether price faces a potential 30% correction after failing to break $400
The cryptocurrency market momentum has swung back to Bitcoin (BTC) recently as BTC dominance and trading volumes have been climbing along with its price. In that regard, the primary altcoin indicator, Ether (ETH), has not been doing well as ETH/BTC has dropped 30% in the last two months.
Now, many crypto traders are asking when the altcoins will bottom out and start to rally again. Let’s take a look at what the charts are showing.
Ether staying above 100-week and 200-week MAs
The weekly chart shows a precise range, as Ether’s price couldn’t break through the resistance zone at $450. However, some bullish indicators are also seen on the charts.
One of those bullish indicators is the breakthrough of the 100-week and 200-week moving averages (MAs). These MAs are often seen as a crucial indicator of bullish/bearish sentiment of the markets. Because the price of Ether broke through the MAs in the previous months, it can be said with confidence that this cryptocurrency is in bullish territory.
However, another bullish argument is the breakthrough above $270, which has been resistance for over a year and was only overcome in recent months.
An apparent breakthrough occurred, after which the price of Ether rallied toward $450. In this breakout, however, no clear support/resistance flip of this $270 zone occurred, which means a retracement toward this level will be relatively healthy.
Hence, a range between $270 and $450 is established based on the weekly chart. In other words, a likely retest of the $270 area is on the table.
Breaking the $450 to the upside means continuation toward $800 is very likely.
Ether resting on $368–$375 support
The daily chart shows a potential rising-wedge construction with decreasing volume. This rising-wedge construction is currently resting on the $368–$378 support level. This level is crucial for lower time frames.
If this area is lost, a sharp fall can be anticipated. In that regard, a test of the $315 level or even the $270 and potentially $250 levels are on the table. If the $368–$378 level is lost, the 100-day MA will also lose its support value, indicating more downside potential.
The four-hour chart indicates a slight upward move in the previous 24 hours. However, the push upward couldn’t break through the resistance zone at $400, which resulted in a significant drop afterward.
This drop was also caused by weakness on the Bitcoin markets and a significant inflow of ETH from a single entity to the exchanges, just minutes before the fall occurred.
ETH/BTC facing potential support zones
Historically, the fourth quarter is not the best period to hold ETH until it bottoms out in December. It doesn’t seem to be any different this year so far, as Ether’s price has fallen 30% since its recent high at 0.04 sats.
The Ether chart against Bitcoin is showing a clear view of the support and resistance levels.
On the higher timeframes, a potential support zone is approaching. Alongside the 200-week MA, support could be found at the 0.024–0.026 sats area, as that’s the previous resistance zone to flip for support.
The ETH/BTC daily chart of Ether shows a slight bounce in the last days as the 0.028 sats area served as support. However, there’s no sign of reversal yet, as the price of Ether still appears to be correcting.
Bullish arguments can be made once the upper resistance zone at 0.0315 sats breaks and flips for support. Other bullish signs include Ether bottoming out at 0.026 sats with a bullish divergence at the bottom. This would be the strongest indication of any bottom structure.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Bitcoin (BTC) fell below $26,000 on Dec. 29 as fresh fallout from Ripple’s threatened U.S. lawsuit was felt throughout crypto markets.
BTC price dips as Coinbase halts XRP trading
Data from Cointelegraph Markets, Coin360 and TradingView showed BTC/USD hitting lows of $25,830 during Tuesday trading.
$27,000 support failed to hold overnight, sparking a retest of lower levels which now center on $26,000. At the weekend, Bitcoin hit all-time highs of $28,400 before swiftly reversing.
The latest losses come as XRP, the fourth-largest cryptocurrency by market cap, hits $0.23 thanks to major U.S. exchange Coinbase opting to suspend trading from next month. The reason is a lawsuit from the U.S. Securities and Exchange Commission (SEC), which threatens to classify XRP as an unlicensed security and make trading it all but impossible.
“There is going to be a rangebound construction, after which 2021 will most likely break out again,” Cointelegraph Markets analyst Michaël van de Poppe summarized about Bitcoin’s short-term perspectives in a video update on Monday.
Analyst braced for altseason
Van de Poppe is eyeing altcoins as next in line to see major gains. XRP notwithstanding, the market is already showing signs of life, with Ether (ETH) climbing above $700 for the first time since May 2018 this week.
Another winner on Tuesday was Polkadot (DOT), now the seventh-largest token by market cap, which saw a 22.5% daily rise, capping weekly performance of nearly 34%.
For Van de Poppe, the next “impulse wave” on Bitcoin in 2021 should take the market to $40,000 or $50,000, but “until then, altcoins will most likely do well.”
He additionally pointed to a likely top in Bitcoin market cap dominance, which at almost 70% should soon give way to altcoin presence. December tends to see BTC dominance peaks, with 2017, the time of Bitcoin’s first attempt to crack $20,000, a notable comparison.
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