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Ethereum Classic is at its April lows once more, but what of recovery

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Disclaimer: The findings of the following article are the sole opinions of the writer and should not be considered investment advice

Observing a longer timeframe for Ethereum Classic, it was seen that the $28.6 area was a zone from which the price had rallied in mid-April. In early May, Ethereum Classic had a blow-off top at $179. Since then, Ethereum Classic has been on a steady downtrend.

On the hourly chart, Ethereum Classic was still trading within a bearish structure but had some bullish momentum behind it. Could it break the area of supply at $30?

Source: ETC/USDT on TradingView

The trendline (white) resistance has been a resistance that the price has respected since mid-November. Each test of this resistance has been followed by a sharp rejection in subsequent days.

The Visible Range Volume Profile showed that the price was trading just below the Value Area Lows. This indicated that based on the volume profile, long positions can be considered. However, the market structure was still bearish as the most recent highs have not yet been taken out (marked with the horizontal).

Moreover, right above those recent highs of the past couple of days lay an area where sellers have been strong recently. Unless the price can flip this area from supply to demand, short-term bullish momentum might see a sharp reversal.

Rationale

Source: ETC/USDT on TradingView

The RSI climbed past neutral 50 and suggested that bullish momentum was rising. The RSI on the hourly chart also climbed back above the 60-mark, something it had been unable to do for more than a week.

The Directional Movement Index pictured a strong bullish trend in progress as both the ADX (yellow) and the +DI (green) were well above 20 and climbing.

Conclusion

The indicators noted upward momentum, while the price also entered the Value Area Lows. Although a rule of thumb is to look for longs in this area, the short-term market structure remained bearish. ETC would have to climb above $30 and flip it from supply to demand before it can offer a buying opportunity.

There was also a longer-term trendline resistance to beat. However, in the event that it does, the entire area from $31.5 to $34.6 (Point of Control) could be quickly reclaimed by the bulls as there has not been much trading volume there in recent days to impede the price’s progress.

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Akashnath S is a Senior Journalist and Technical Analysis expert at AMBCrypto. He specializes in dissecting price action, identifying key market trends through advanced chart patterns, and forecasting both short-term and long-term asset trajectories. His distinct analytical method is grounded in his academic training as a Chemical Engineer. This background provides him with a systematic, process-oriented approach to market data, enabling him to analyze the complex dynamics of financial markets with precision and objectivity. Having actively covered the cryptocurrency space since the landmark 2017 market cycle, Akashnath possesses years of experience navigating both bull and bear markets. This seasoned perspective is critical to his insightful reporting on market volatility and evolution. As an active market participant, Akashnath enhances his analysis with crucial, hands-on experience. This practical application of his technical skills ensures his insights are not merely theoretical, but are also relevant and actionable for an audience looking to understand and navigate trading opportunities. He is dedicated to educating readers on the nuances of technical analysis, empowering them with the knowledge to make more informed financial decisions.
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