The ETH/USD has dipped a little bit during the trading session on Wednesday but found buyers on the dip to continue to hang around the 50 Day EMA. It looks as if we are trying to form a little bit of a short-term base, and whether or not we can take off from here is still open for debate.
If we break down below the $1500 level, then it opens up more selling pressure for the Ethereum market, perhaps opening up a move all the way down to the $1200 level. The $1200 level is the top of a previous consolidation area, so there should be a little bit of “market memory” in that area. Breaking down below that level then opens up the possibility of a move down to the $900 level.
Waiting for “The Merge”
- The Ethereum market is a little bit different than some of the other crypto markets right now because we do have “The Merge” coming in the next several weeks, but it’s also worth noting that the market will continue to see a lot of questions when it comes to risk appetite in general.
- Even though Ethereum is probably going to be quite strong over the longer term, there is a lot of institutional money out there that is not willing to put a lot of risk on right now.
- Furthermore, it’s obvious that there is a bit of a ceiling in the market near the $2000 level, especially now that the 200 Day EMA is sitting in that same general vicinity.
Speaking of the $2000 level, if we were to break above there, then is very likely that we would enter a new bullish phase, sending this market much higher. In that general vicinity, I think that you would see a lot of money go flying into this market. Alternately, if we do break down from here, we could see the Ethereum drop all the way down to the $400 level. This would go in line with the Bitcoin market breaking down, which looks like it could. I recognize that we have “The Merge” coming in the next couple of weeks, but it would not be the first time that we have seen a “by the news, sell the announcement” type of trade work itself into the marketplace.
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