Ethereum has experienced a 10% correction over the past two days, but the bulls have failed to sustain the price above $2K. The last two days in the US stock market ended with red candles. According to many analysts, this uptrend was just a dead cat bounce.
Ethereum is trading below the descending line (in yellow) on a daily basis. As of now, buyers have not been able to push it above this line and make higher levels despite several attempts.
The formation of lower highs and lows indicates the prominence of a bearish structure. If buyers attract enough capital inflows to reverse the downtrend, they must first bounce back above the $2000-$2200 resistance level. This would be the necessary first step in reducing the bearish momentum and potentially fueling a new trend.
On the other hand, the bulls need to defend $1,700 as an important support. If they fail, the bears are likely to increase the downside pressure and explore lower levels.
Key Support Levels: $1700 and $1500
Major Resistance Levels: $2000 and $2200
Overall, the BTC chart shows a bearish structure which confirms the downside momentum. Based on the inability of ETH to bounce back above the lost support levels in the USD chart, the price is more likely to drop to the support level at 0.055 BTC (White Circle).
The point to consider for a possible reversal is 0.065 BTC.
Key Support Levels: 0.060 BTC and 0.055 BTC
key resistance level: 0.065 BTC and 0.070 BTC
Number of new addresses (7d moving average)
Typically, price increases are accompanied by an influx of new investors, which is reflected in this metric. The chart shows that the number of new addresses has increased significantly each time the market structure moves up.
This metric hasn’t indicated any notable new user adoption, despite the recent surge in prices in recent days. Going by this data, investors are still not confident about the reversal in the short term.
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Cryptocurrency charts by TradingView.