- Ethereum rallied slightly during the early trading session on Tuesday, only to turn around and show signs of life again.
- Ultimately, we have broken above the 50-Day EMA, and it looks like we are trying to turn things around and continue to go higher.
- At that point, it’s also possible that we could go as high as the $3500 level above, which is right in the middle of the overall consolidation area that we have been in.
Consolidation Continues
The market continues to consolidate in the same area that it has been in for a while. The $3000 level underneath continues to offer plenty of support, while the $4000 level above has been a ceiling in this market. As we are looking at the lower end of the range as being where we are trading, it’s not a huge surprise to see the market turnaround. All things being equal, this is a market that I think continues to see a lot of noisy behavior and therefore I think we get a situation where you need to be cautious with the size your position, but clearly Ethereum looks as if it is going to continue to be bullish and it should continue to attract inflow.
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If we were to break down below the $2850 level, then it’s likely that we could drop down to the $2600 level, which is essentially where the 200-Day EMA currently presides. Nonetheless, keep in mind that you need to keep an eye on Bitcoin, because Bitcoin leads the way for all cryptocurrency markets, including the Ethereum market. As long as Bitcoin does well, then you have a shot of Ethereum rally and. On the other hand, if Bitcoin starts to fall apart for some reason, Ethereum will get absolutely hammered.
In general, I think this remains a “buy on the dips” market, and with that being the case it’s likely that we will eventually see plenty of buyers jump into Ethereum in order to take advantage of what looks to be a massive boom in the crypto markets, and of course the fact that Wall Street is now getting involved.
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