A bearish wave hit Ethereum a few days after the Shanghai upgrade. Ether (ETH) could potentially close monthly in the red. What to expect ?
Ether (ETH) loses 14%
After creating the high of the year ($2138) after the Shanghai upgrade, ether (ETH) continues with a 14% decline. Sure enough, a bearish wave hit this crypto last week. This pushed the price down close to the month’s open. Currently, ETH is stabilizing around $1862 due to low weekend volatility. The April opening price ($1822) could act as support for the price. Thus, an upside rally in Ether (ETH) could be possible. If the price continues its run and breaks above the high of $2138, we can expect a strong bullish impulse above $2200.
This is a likely scenario if the price bounces off the $1822 support, while avoiding the monthly close in the red. Then, we can see that ether (ETH) is very close to the 50-day moving average, which could also act as a major support. We are therefore waiting for the price of ETH to react to this support zone, before confirming this bullish thesis. However, the significance of last week’s decline should not be overlooked. Indeed, ether (ETH) broke through several oblique supports with this decline. This could signify a short-term trend change. In this case, a short position around $2050 would be possible.
A buying or selling opportunity?
The major (long-term) structure of Ether (ETH) remains bullish. However, a drop of 14% will not be negligible in the short term. Thus, one could look for a correction towards $1600 if this bearish wave continues to hit. Moreover, profit-taking by buyers could explain this decline. Thus, the bounce off the $1822 support could be a short selling opportunity.
In this case, it would be better to wait for ETH to rally around $2029 before taking a short position. If the price bottoms out below $1822 on Tuesday, there is potential to go long down to $2029. At the moment, waiting for a short position in ether (ETH) at $2029 seems more prudent.
Admission: $2,029;
Stop: $2121;
Goal: $1600.
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