The price of ether, ethereum's native token, is likely to head south unless the bulls can quickly pull the price back over $1,160 levels, price chart analysis indicates.
On Coinbase's GDAX exchange, ether hit a one-week low of $905 at 11:50 UTC today. A sharp recovery from the last week's low of $757 ran out of steam at $1,164 over the weekend. The subsequent drop to sub-$1000 levels has left a lower high (bearish action) on the charts. As of writing, the cryptocurrency is changing hands at $930 levels on GDAX exchange.
ETH has depreciated by 8 percent in the last 24 hours, according to data from OnChainFX. Further, prices are down 20 percent from the weekend high of $1164. Still, the technical charts are now showing oversold conditions.
The price charts indicate that ether will mostly likely erase the 22 percent gains made since last week's low of $757 in a slow and steady manner over the next couple of days.
The above chart (prices as per Coinbase) shows:
- ETH left a lower high at the key 61.8 percent Fibonacci retracement level of $1,166.71 over the weekend. The decline witnessed in the following 24 hours yielded a bearish crossover between the 50-day moving average (MA) and 100-day MA (short-term average cuts long-term average from above).
- The rejection at 61.8 percent Fibonacci level indicates the corrective rally has ended and the bears have regained control.
- 50-day MA carries a strong bearish bias (sloping downwards), while the 100- and 200-day MAs are neutral.
- The relative strength index (RSI) shows scope for further losses (being below 50.00) and well short of the oversold territory (below 30.00).
- Ether looks set to close below $927.29 (38.2 percent Fibonacci retracement of the rally from the July low to January high) and extend losses to $775 (50 percent Fibonacci retracement) in the near-term. A violation there would expose trendline support of $752.
- A close (as per UTC) below $752 may signal a longer-term bullish-to-bearish trend change.
- Bullish scenario: A close (as per UTC) above $1,164.97 (Jan. 20 high) would revive the bullish view.
Umbrella image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.