Ethereum has pulled back a bit during the trading session on Friday, breaking below the $4500 level. It is probably worth noting that there was a general “risk off attitude” around the world during the day, so Ethereum fallen a bit should probably not be too much of a surprise. Furthermore, the market was a bit overextended to begin with, so a little bit of a pullback makes a certain amount of sense. This does not necessarily mean that I am looking to short this market, but I do think that it is only a matter of time before we see a certain amount of support.
Underneath, the $4000 level continues to be important, as it was a crucial resistance barrier previously, and therefore I think it should offer a little bit of “market memory” going forward. The market eventually will find plenty of buyers underneath, and therefore I think looking towards large, round, psychologically significant numbers makes quite a bit of sense. Furthermore, you also have to keep in mind that the 50 day EMA currently sits at $3655, and it certainly looks as if it is going to go looking towards the $4000 level. I think everything kind of comes together in the same area, and buyers get involved. Even if we were to break down below there, Ethereum is very much in a bullish market.
Furthermore, you have to pay close attention to the fact that the US dollar strengthened a bit during the trading session on Thursday, so it does make a certain amount of sense that the Ethereum market pulled back against the greenback. That being said though, this overextension probably bags for a little bit of a pullback, so I think that if we get a little bit of an opportunity to pick this market up on a dip, it allows a bit of an opportunity to get involved yet again. Quite frankly, this is a massive uptrend, and there is no way to short this market anytime soon. Ethereum is more likely than not to go looking towards $5000, and at this point it is probably only a matter of time before we get there. Longer-term, a lot of experts are anticipating that the market will eventually get to the $8000 level, but it may take a little while before that happens. The one thing that is always interesting of course is that the crypto markets can get there much quicker than you anticipate.
