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After incurring some massive upwards momentum over the past several days and weeks, Ethereum has now faced a significant influx of selling pressure that has sent its price reeling to lows of roughly $190, and without any major change within the aggregated crypto markets, it is highly likely that ETH will continue facing significant downwards pressure.
Ethereum’s downwards pressure has come as a surprise to the crypto industry, as its recent upwards momentum previously appeared to be emblematic of a long-term trend shift that would extend significantly further.
Ethereum Reels Down Towards $190
At the time of writing, Ethereum is trading down nearly 9% at its current price of $191.78, which marks an incredibly steep retrace from its daily highs of $210.
Over a one-week period, ETH is trading down even more significantly, as it has plummeted from highs of over $220, which is where it found insurmountable resistance that sparked the current downtrend that it is currently within.
Furthermore, this downtrend has been perpetuated by Bitcoin’s downturn, as it lost its foothold within the lower-$10,000 region and is now nearing its critical long-term support level that exists in the lower-$9,000 region.
NebraskanGooner, a popular crypto analyst on Twitter, spoke about Ethereum in a recent tweet, explaining that its downtrend first began when it faced a rejection at $223, which is what opened the gates for a movement to $190.
“#Ethereum… nailed it with the dead cat bounce signal and 1.337 fib rejection at around $223. $190 target just hit,” he noted.
Too Goon X nailed it with the dead cat bouncr signal and 1.337 fib rejection at around $223.
$190 target just hit. 🎯 https://t.co/YAYxS9qmUw
— Nebraskangooner (@Nebraskangooner) September 24, 2019
Recent ETH Drop Sparked By 200-Day EMA Rejection
In the near-term, how ETH reacts to $190 will likely prove to be critical for determining its near-term trend, but bears may be bolstered by ETH’s recent rejection at its 200-day EMA, which signals that bulls lacked enough underlying strength to propel it higher.
Rekt Capital, another popular crypto analyst on Twitter, explained earlier this week that breaks above the 200-day EMA have statistically been emblematic of a bullish breakout, but in the time since he spoke about this the crypto has faced a strong rejection at this level which sparked the current downtrend.
“The 200 EMA is a gauge of long-term market sentiment. $ETHUSD cleared through its 200 EMA only 4 times before 3 of those 4 times were when $ETH was in a macro uptrend. Here are the rallies for each of those 3 times: February 2017: +13,071% May 2019: +101%. Two days ago: Pending,” he explained.
The 200 EMA is a gauge of longterm market sentiment$ETHUSD cleared through its 200 EMA only 4 times before
3 of those 4 times were when $ETH was in a macro uptrend
Here are the rallies for each of those 3 times:
February 2017: +13,071%
May 2019: +101%
Two days ago: Pending pic.twitter.com/h2QuNKINjj
— Rekt Capital (@rektcapital) September 21, 2019
If Bitcoin continues moving lower and ETH fails to hold above $190, it is highly probable that it will continue dropping significantly lower in the near-term and may even erase all of its recent gains.
Featured image from Shutterstock.
