Ethereum (ETH) Bulls Brace For Quick Drop As Charts Predict 10% Downswing
March 21 2023 - 1:28AM
NEWSBTC
Ethereum (ETH) price has shown signs of a potential downturn as it
reached an exhaustion of bullish momentum, signaling a possible
drop in the near future. According to analysts, ETH has produced a
clear sell signal, indicating a shift in the cryptocurrency’s
trend. The world’s second-largest cryptocurrency by market
capitalization has been on a bullish run for the past few weeks,
with its price surging by more than 34% in just a matter of days,
according CoinMarketCap data. The digital asset has been benefiting
from a strong market sentiment, as well as the growing interest in
decentralized finance (DeFi) and non-fungible tokens
(NFTs). However, experts are suggesting that this could be an
opportunity for long-term investors to accumulate and take
advantage of the potential dip. Related Reading: Ethereum
Unsettling Investors As Downward Price Potential Grows Ethereum
Price To Face Immediate Resistance Like Bitcoin, Ethereum has been
experiencing a bullish trend and traded above $1,800 earlier today,
although it has since fallen to $1,759 at the time of writing.
Other cryptocurrencies such as Litecoin (LTC), Dogecoin (DOGE),
Solana (SOL), and Ripple (XRP) have also seen significant gains.
ETH trying to breach multi-year resistance. Chart: TradingView
TradingView data shows the ETH/USD pair is positively biased, its
upward momentum is not as strong as Bitcoin’s. Ethereum is
currently struggling to break through the $1,800 level and may face
resistance at $1,900 if it does. Despite Ethereum’s price reaching
higher highs since March 14, the Relative Strength Index (RSI) and
Awesome Oscillator have produced lower highs, indicating a
divergence. Divergence can lead to declining momentum and a
potential reversal in price. In the context of cryptocurrency
prices, divergence refers to a situation where the price of a
particular cryptocurrency moves in a different direction than that
of a related asset or benchmark. ETH total market cap now at $214
billion on the daily chart at TradingView.com For example, if the
price of Bitcoin is rising, but the price of Ethereum is falling,
this could be considered a divergence between the two
cryptocurrencies. This phenomenon can occur due to a variety of
factors, such as differences in market sentiment, news events, or
technical factors affecting each cryptocurrency. Traders and
investors may use divergence as a signal to adjust their trading
strategies, as it can indicate a shift in market dynamics or
potential opportunities for profit. Related Reading: Bitcoin Price
Barrels Past $28,000 – Can BTC Keep Pushing This Week? Bullish
Thesis At Stake Although Ethereum’s price has been on an upward
trend, it is possible that it may experience a 10% drop and fall to
either the psychological level of $1,600 or the monthly level of
$1,677. This potential drop should be approached with caution,
as it could signal a shift in market sentiment. Specifically, if
the price drops below the $1,600 level and continues to experience
selling pressure, it could lead to the $1,422 level becoming a
resistance level and invalidate the optimistic outlook for
Ethereum. -Featured image from EthereumPrice
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