Ethereum Price Analysis: 31 January
Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be taken as investment advice
The second-largest cryptocurrency, Ethereum [ETH] has remained unimpacted by Bitcoin’s volatility over the past couple of days. The value of the digital asset has managed to stay above the $1,322 support and was currently trading at $1,340.
Ethereum 6-hour chart
The above chart of Ether indicated that it has been consolidating between $1,322 and $1,396 in the short-term. The price witnessed a push to $1,451 when Bitcoin surged but immediately retraced to $1,297. It found support at $1,322 after testing it twice and might be heading for a third round.
Ether was noting a rise from the seller’s end at the time of press, but the drop may not be as drastic. However, one may not rule out Bitcoin’s volatility yet, as it could cause a price swing.
As the value of ETH retraced between the immediate support and resistance, the 50 moving average also intertwined with the candlesticks. However, as the selling pressure increases, the 50 moving average has shifted above the candles.
The Relative Strength Index did not swing but maintained its move along the equilibrium zone. The sellers and buyers were equal in the market but the dropping RSI value at 42 reaffirmed the selling pressure evolving in the market.
The reason for a minimal drop was also due to the low momentum visible in the above chart. The Awesome Oscillator was showing that the length of the green and red bars had reduced to almost zero. Thus, even if the price drops, the momentum may limit the drop.
Ethereum’s market though slightly bearish might witness a $10 to $20 drop and bounce back. The support of $1,322 has been strong and the price may continue within the current bracket. Traders might want to watch out for Bitcoin’s volatility which will always impact the alts.