Ethereum (ETH) has again followed Bitcoin’s (BTC) lead, by following Bitcoin down for another dip. This is true even for the ETH/BTC pairing, resulting in the typical double-damage on the USD pairing. But the leading altcoin is holding some critical levels, and could still be in a larger-term uptrend.
We start with the ETH/BTC daily chart for a larger view. Here we see a support from summer holding the altcoin, as well as the 55 EMA. ETH has been uptrending here since September, after breaking a price level that had held for years, around ₿0.0237
A possible Elliott wave impulse count (1-5) might signify that the recent downside is a normal an expected correction. According to this interpretation, Ethereum could retrace quite a bit further before canceling out this large uptrend started in September.
On the daily ETH/USD chart, however, we see that Ethereum has been downtrending more consistently than ETH/BTC, stuck under all the EMAs. What’s more, it definitely looks as if the altcoin could dive a little deeper on this chart if it wants to.
The RSI here broke an uptrend earlier in the month, and has plenty of room left before reaching oversold conditions. The histogram — after yesterday’s dump — is arching down aggressively. However, there is a well-worn block of support here, down to as far as $150, so ETH has a strong chance of holding with this block.
And within this block is the $158 zone, which marks the breakout level for ETH in the first quarter of the year (below). This has actually already been tested and held, and unless Ethereum is in a multi-year downtrend that didn’t actually finish in 2018, we are unlikely to see this break.
Finally, moving to the much shorter hourly ETH/USD chart, we see that oversold conditions were quickly reached on the sharp selloff. A weak bounce and rejection already at the 8 EMA, along with weak buy volume, suggest that another leg down is possible.
The histogram here was uptrending flat, but at time of writing seems to be starting an arch down.
Overall, there are reasons to get excited about Ethereum in the longer term. The USD pairing is likely at the bottom of its chart, and the BTC pairing is likely still in a large uptrend. On the short term, however, we see plenty of weakness. Adding to this, with Bitcoin’s shakiness — and Ethereum’s recent characteristic of following Bitcoin’s direction even on the BTC pairing — Ethereum most be treated with caution for longing.
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