As an analyst with experience in studying cryptocurrency markets, I have closely observed Ethereum’s recent three-day losing streak, which saw its price drop by 12% from $3286 to $2888. The increasing volume during this period suggests sellers’ conviction, as Bitcoin’s value dipped below the $60K mark.
During the wider market downturn, Ethereum‘s coin price dropped by 12% over three consecutive days, from $3286 to $2888. This decline was accompanied by a surge in trading volume, suggesting that sellers are confident in driving down the asset value further as Bitcoin hovers below the $60,000 mark. Nevertheless, a look at the daily chart indicates that the correction has not yet breached a significant support level and maintains the overall bullish trend, implying a possible price rebound.
Ethereum’s Falling Wedge Hints a Silver Lining in the Bearish Cloud
Over the past seven weeks, Ethereum’s price behavior has provided a classic illustration of a downtrend in financial markets. Each day has brought new lows that undercut previous daily lows and lower highs that failed to surpass previous ones. This pattern, combined with downsloping trendlines, forms a falling wedge chart configuration. Typically identified within an established uptrend, the falling wedge is considered a bullish continuation setup.
Due to the influence of this pattern, the Ethereum (ETH) price has dropped dramatically from its peak of $4084 to its current trading value of $2899, representing a significant decrease of approximately 30%. If the broader market sell-off continues, there is a potential for ETH to decline an additional 6%, reaching a lower trendline at around $2700.
Previously mentioned level aligning with the 50% retracement level and the slope of the 200-day moving average formed a significant buying opportunity for investors to counteract the downward trend. If demand picks up again at $2700, it could be an early signal of local price bottom formation.
If the wedge pattern is to be broken upward by the price, then the buyers can expect a revival in the uptrend.
Historical Returns Hints Ethereum Price Recovery In May
As a researcher studying Ethereum’s historical price trends, I’ve observed that the cryptocurrency’s performance in the month of May has been quite volatile over the years. In the recent past, Ethereum experienced a modest decrease of 3.79% as of May 2024. Conversely, it registered a slight increase of only 0.16% during May 2023. However, it’s important to note that May 2022 was marked by a significant downturn, with Ethereum plummeting by a steep 28.84%.
Instead of “In contrast,” you could say “Notably, May 2017 and 2019 experienced significant gains of 161.43% and 56.65% respectively, showcasing the potential for substantial returns amidst market instability. Conversely, Ethereum prices suffered losses in 2018 and 2021, registering a decrease of 13.96% and 2.31% respectively.”
As an analyst, I’d interpret the 23.66% average gain as a promising sign for Ethereum’s recovery and maintaining a bullish stance during this month.
Technical Indicator
- Average Directional Index: The ADX slope uptick near 23% indicates the sellers are gaining momentum for a prolonged downfall.
Exponential Moving Average: The ETH price trading above the 200-day EMA slope accentuates the broader market sentiment remains positive.
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2024-05-01 19:00