Ethereum’s growth was temporary. The reason for that was a significant resistance in the form of accumulated volume of sell orders. When will this protracted flat end?
Results of the summer
This summer started with many people deciding to buy Ether. An exit from a flat, which has been forming during the entirety of spring, should have led to a long upward movement. But the negative news has provoked many into selling Ether. After a short rally, Ethereum’s price has returned to the value it had in early spring.
It’s worth noting that with regards to Bitcoin, this growth has taken a form of a correction wave. Without fortifying at a key line, ETHBTC went downwards towards the next level. Before Ethereum fell, many decided to buy Bitcoin. Bitcoin’s growth was quite powerful, but after a downward Ethereum trend, a lot of traders started selling their Bitcoins. News of the DAO hack have caused a small panic on Ethereum, which led to a lot of Ether sell orders. Could those events become a reason for Bitcoin’s fall?
At the moment, Ethereum’s price is yet again testing an important level, with an accumulated volume of sell orders. The situation is still ambiguous. A rebound from the resistance line indicates just that. Many are indecisive about buying Ether. That’s why the growth was followed by a fall towards the starting point. A more confident growth of Ether will only be possible after the price stops near the level of 0.022 (or $13 on ETHUSD). Such a reaction will indicate a possibility for a more protracted growth. More than 88K ethers is accumulated in sell orders at that mark, which is a third more than the buy orders. That’s why a fortification near 0.022 and formation of a turn could lead to a good upward impulse.
Until that scenario plays out, Ethereum’s price has a chance to fall to the lower level of 0.015. A large volume of buy orders has accumulated at the 0.015 mark, which is why the long-term scenario will be decided at that level.
The price of Ethereum Classic has managed to fortify beyond the accumulated volume near $1.3 and form an upward trend. That movement is so far within the boundaries of a correction for the entire downward trend from $3.5, because ETC’s price will face a tough resistance line near $2.2. Large volumes of sell orders are formed at that mark, so the trend can change there.
As was mentioned earlier, a more protracted growth has to be backed by something. If ETC’s price manages to hold near large sell orders will mean that the traders’ overall sentiment is positive. An example of such scenario took place on September 3-4. ETC’s price bounced from the accumulated volume and started growing. The level of $1.3 became a support line for this upward trend. If a similar reaction happens near $2.2, the scenario may repeat itself.
Dollar’s growth did not continue, which led to other fiat currencies growing, along with Ether’s price. World currencies have reached their technicals, where, as a rule of thumb, new trends are defined. This week will be rich with announcements by heads of banks of the UK and the EU. It is possible that the news-to-be-released will lead to new impulses for fiat currencies. In case of a negative scenario, the fall of currencies can be a signal for Ethereum.
Key technicals, where a change of trends is most likely:
- For a more definite formation of Ether growth, the levels of 0.022 (ETHBTC) and $13 (ETHUSD) are important.
- The most likely peak of the upward correction on Ethereum Classic will be near $2.2.