For those that followed yesterday’s analysis, Bitcoin has now well and truly entered into the red area below the key fibonacci support after sustaining heavy damage from bearish opposition. As BTC fights to stay clear of its lower support at $7,100 today, the rest of the market has continued to suffer badly from this ongoing downtrend.
Ethereum stands out as one of the worst affected among the top 20 cryptocurrencies, with a near double-figure loss against the US dollar value over the last 24hrs.
With the second largest cryptocurrency by market capital now hovering around the $560 mark, how long will it be until we see it touch back down to $500 again?
Over 3hr candles we can see Ethereum completed a bearish H&S pattern which foreshadowed a further decline in the price action, after ETH fell below the neckline at $650.
An early attempt of re-testing the head of this pattern was made by bullish traders, but unfortunately it failed to gather sufficient support to hold off the bears advance.
At the time of writing the asset is temporarily resting along the 0.5 fib support at $565 following a series of steep sell-offs and a second unsuccessful run by the bulls; this time trying to break above the 0.618 fib level at $605.
Judging by the EMA’s above it’s very likely that we’ll continue to see this downfall play out and should expect red candles to break below this key area soon.
The circled area on the chart shows a strong bearish indicator, with the 50 EMA (blue) diving down towards the 1,200 EMA (yellow), as buying momentum begins to rapidly decline. A crossover between these two lines will confirm a prolonged bearish continuation for the Ethereum token.
Looking at the current price action over 30min candles we can see short-term momentum is also favouring the sellers.
- MACD is deep below the signal line and showing little signs of converging above the slower moving average, at this moment in time
- RSI is showing 3 oversold moments during the recent decline, but for now ETH is tracking just inside of the lower channel line.
- Accumulation/ Distribution line is still dropping as investment continues to pour out of the Ethereum market.
Ethereum (ETH) Price Prediction
As traders flock to exit out of the falling BTC and ETH markets today, we should expect to see Ethereum plunge below the 0.5 fib level at $565 shortly.
From there we should expect the price action to oscillate inside a channel between here and the lower 0.382 fib support at $525; testing the nerves of loyal Ethereum hodl’ers as it looms closer towards the dangerous $500 mark.
If bullish confidence flags during this stage, and the price action falls to the lower support, then it’s very likely that we’ll see further panic-driven withdrawals from this asset - sending it to it’s next support around $480. Delivering a loss of -15.04% from the 0.5 fib level.
This article appeared first on Cryptovest
