Cryptocurrency

Can Ethereum Classic’s [ETC] breakout trigger a rally or is it a bull trap

Disclaimer: The info offered doesn’t represent monetary, funding, buying and selling, or different forms of recommendation and is solely the opinion of the author.

Global inventory market indices have been in a freefall over the previous two weeks. Bitcoin has additionally seen extreme losses over the identical time interval, measuring near a 35% drop. Given this backdrop, the altcoin market has additionally quickly shed worth. Ethereum Classic noticed a near-term bullish market construction break. Yet, this is able to seemingly not be sufficient to reverse the robust downtrend for the altcoin.

ETC- 4-Hour Chart

Source: ETC/USDT on TradingView

On the H4 chart, it might be seen that the value has set a sequence of decrease highs since late May. What is not proven on the charts is that this downtrend stretches again to early April.

At the time of writing, there have been two zones of nonetheless resistance for ETC. The higher one was $18, and the decrease one at $14.8, each demarcated by crimson packing containers. Moreover, the 38.2% Fibonacci retracement degree added confluence to the $18 resistance zone.

ETC broke previous the $15.3 degree prior to now couple of days of buying and selling. This flipped the near-term market construction to bullish. The $13.89 help additionally appeared to have been defended.

Yet, the upper timeframe bias stays strongly bearish. Therefore, a shorting alternative might quickly current itself.

ETC- 1 Hour Chart

Ethereum Classic makes a bullish break, but the upward move could falter at this resistance region

Source: ETC/USDT on TradingView

The H1 chart highlighted the bullish construction flip, however the $16.15 degree has not but been crushed. In reality, the sweep of this degree the day gone by earlier than a transfer decrease instructed that the development was firmly bearish.

Hence, The total area from $14.6 to $16.1 can be utilized to enter a quick place. Bearish divergence on a timeframe greater than the H1 might supply a extra exact entry.

Ethereum Classic makes a bullish break, but the upward move could falter at this resistance region

Source: ETC/USDT on TradingView

The RSI on the hourly was preventing with the impartial 50 mark. Even if the hourly RSI climbs greater, it wouldn’t counsel a development reversal. The OBV noticed a spike greater on the day gone by of buying and selling, whereas the CMF climbed to -0.04.

Taken collectively, it instructed the presence of some shopping for stress. Yet, it wasn’t overwhelming stress, and won’t imply a development reversal to the bullish aspect.

Conclusion

The greater timeframe bias stays bearish, regardless of the bullish break on the decrease timeframes. The $16.15 degree stays unbroken, and the $14.8 is additionally a zone of resistance.

Therefore, a quick place might be scaled into between the $14.8 and $16.1 ranges, with a stop-loss simply above $16.3. To the south, the 23.6% Fibonacci extension degree at $10.13 may very well be a bearish goal.

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