The Ethereum market rallied nicely on Friday to show signs of life, as we have broken above the $1200 level. That being said, the market looks as if it is going to continue to see a lot of noise, but I think a bounce from here more likely than not will get sold into given enough time. After all, Ethereum is going to go down with the rest of the ship, and although we are oversold at the moment, that is just a reason to go into a bit of a relief rally.
The 50-day EMA sits at the $1700 level and is dropping quite significantly. That’s an area where we could start to see sellers again because there’s no real reason to think that risk appetite is back for the long term. While we have seen the stock market recover quite nicely, the reality is that the positive correlation between crypto and stocks makes for upward pressure in the short term. Ultimately, this is a market that has plenty of sellers above, just as the stock market will. The markets will continue to be noisy, but if you’re patient enough you should get an opportunity to start shorting again.
Eventually, I would anticipate that Ethereum dropped back below the $1000 level, but that doesn’t necessarily mean that it will happen in the next couple of days. The uptrend has a way to go because this is a situation where we have a lot of noise ahead of us, and I think if we are going to turn around and recover, we need to spend more time building a bit of a base than we have. We need to have investors comfortable going along for the long term, which is something that they may or may not be able to say at this moment. The market will continue to be noisy, but I think you will get an opportunity to get this market at sub-$1000 levels. If we were to break above the $2000 level, that would obviously change a lot, because it would double the price right now, and that would be a big turnaround. Ultimately, I’m waiting for some type of deeper flush to get involved in a longer-term “buy-and-hold” type of position.
