A 33 percent dip in the last week means Ethereum sellers are stepping on the gas pedal. There are many theories around this rapid decline with most associating this dump with ICOs losing their patience and cashing out. Others are pointing to the influence of Bitcoin and the correlation between the two while some are merging this with mining woes and how unprofitable it has become. Either way, ETH like the rest of the market is on a down trend and trading below $200 with sellers aiming for $150.
From the News
Research has it that, in seven years time, cryptocurrency use would be a stead–and we can see hints of that. Triggering this are events in Iran and Venezuela. There people are literally flocking to ETH, DASH and Bitcoin as a store of their life earnings in the face of run-away inflation and a melting economy. In numerous occasions, cryptocurrencies and individual coins as ETH were evidently bulwarks against government mismanagement and corruption. But, it could get better, more so when the coin become a main stay rather than a tool of speculation.
Backing this is a recent survey by SharePost showed that despite the market downturns, many are confident of a recovery and as the market bottoms, Australians are actually playing the contrarian card, loading coins which they believe would be much more valuable in years to come when they would be a stead in the global economy.
In fact with introduction of more stable coins as Gemini Dollar, which is backed one to one against the USD and overseen by the New York Department of Finance Service, their creators are providing a lee way for investors to invest in crypto now that volatility has been contained. Gemini, an exchange by the Winklevoss Twins, allow users to deposit in USD and withdraw via their Ethereum based stable coin to an Ethereum address and vice versa. What’s unique about this new coin is that the smart contract has been certified to be secure and on a monthly basis, a publically certified auditing firm will run through the stable coin fiat account to ensure that pegging remains 1:1.
Ethereum (ETH) Technical Analysis
If anything, the depreciation in ETH has been rapid and unusual. Many are attributing this to ICO funds unloading their holdings fueling the depreciation and it could be true. So far, ETH prices is down 33 percent in the last week. This means ETH is trading below $200 and would likely hit $150 in the coming days. Of course, this lack of ETH confidence will fast-track this value drain. Exacerbating this is last week’s bearish engulfing candlestick clearing minor supports at $250 triggering shorts trade as highlighted in our last ETH trade plan. Simply because of last week’s declines, we recommend shorts on every high this week with targets at $150.
In the last day, ETH is down four percent and the result is a dip below last week’s low. By edging lower, it means our last ETH trade plan is true. As such, traders can add their short positions on every high in lower time frames. Needless to say, should there be a recovery, it’s likely that prices will find resistance at around $250. That’s before sellers resume their drive towards $150 during the trend resumption phase.
Disclaimer: This is not investment advice and views represent that of the author. Do your own research before making an investment decision.