The price of Ether has reached a long-term resistance line, due to the pressure from the big bears. Usually, under such price conditions, a period of growth is likely. Will there be a return to $14?
The minimal target of the medium-term downward movement has been reached. That target is the bottom limit of the long-term flat, which has been there for almost six months. A new wave of the flat has been formed, which means that the price has two likely scenarios for future development: form a new wave of the flat upwards toward $14, or form a turn towards the decline. One of these scenarios will be confirmed by our technical analysis.
If we look at the intraday picture, it’s clear that the large volumes near the key level of $8.3 have been sold out, and after that, they were bought back near the opposite key marks. That looks like a big seller’s tactic. Of course, there may be several big bears, but their tactics are similar, so for the sake of simplicity we will assume that there is only one. Thus, the price has continued to rapidly fall and grow back again.
In the future, the scenario may repeat itself but on a larger scale. Although, last week the scenario of a possible upward movement was trending towards a flat and the downward movement towards a real trend, at the moment it’s exactly the opposite.
The limit of the flat, which Ethereum’s price has rebounded from several times already, is obvious to everyone and the traders expect a new rebound. This sentiment is confirmed by the large buy order volumes between $6.5 - $7. However, as we have already noted, the situation can repeat itself on a larger scale. If there is a seller on the market who can match that volume, Ethereum’s price will crash to at least $4 - $5. It will continue falling until it hits a significant volume of buy orders, which will be unprofitable for the seller. After that, the price of Ether will rise back. If a big seller doesn’t appear, ETH is in for a flat-like fall. In regards to the upward movement, for a more powerful growth Ether needs to break through the key level near $8.4. If the price goes beyond that point, it will mean that there is a big buyer on the market. If Ether fortifies near $8.4, the odds will be on the side of an upward trend.
The downward movement on Ethereum Classic, which begun at the beginning of November, is over. The price of ETC has formed a flat, caused by the speculation of big buyers. Under such circumstances, the advantage held by the bulls can provoke a more powerful growth.
A big bull is likely to provoke the majority of traders into buying, because the price of Ethereum Classic is profitable for buy deals, considering the fact that it has grown above $3 in the past. That’s why if the majority of traders see signs of growth, the upward movement will become more powerful. It’s important to take note of how exactly the price of ETC will break through the key levels on its way up. If the price fortifies at the level of 0.83, there will be a chance to grow to 0.90 and beyond. It is more profitable for the buyers to sell in the beginning of growth. The beginning of any upward trend is usually situated at the cancellation point of a correction towards a downward trend.
However, if the price fails to break the resistance of $0.83, there will be a formation of at least a new downward wave of the flat.
Key technicals, where a change of trends is most likely:
- For a more certain growth of Ether’s price, it has to break through a key level near $8.4.
- If Ethereum Classic fortifies and forms a turn near $0.83, we will see the first signs of growth.