The Ethereum markets fell yet again on Monday, crashing through the $2500 level. We have bounced back towards the $2350 level, but at this point, Ethereum certainly seems to be sluggish and negative overall. It is worth noting that Bitcoin has ended up forming a bit of a hammer, while Ethereum has not. This could be a slight signal that perhaps crypto markets are going to get a little bit of a reprieve, and after this massive sell off, it is a situation where we could very well get a little bit of a bounce.
On the other hand, if we turn around and break down below the bottom of the candlestick, then it is likely that the Ethereum market will go looking towards the $1750 level underneath, where we had seen a lot of support in a bit of a “double bottom” before we bounced towards the all-time highs. If we were to break down below there, then it is a matter of “look out below.”
Ethereum should have a decent year due to the fact that “Ethereum 2.0” will go live for the most part, and it should bring down gas fees and allow for more transactions per second, a major victory for Ethereum bulls. Longer term, I believe that if we can get some type of stability, it is an opportunity to accumulate even more. The later we get into the year, the higher the price will go, but it is obvious that in the short term you cannot touch this market as it is far too toxic. I would say that about all crypto, even though a short-term bounce makes sense.
I believe that the bounce will probably coincide with Tuesday being the day before the FOMC meeting, which is what everybody is paying attention to. If Jerome Powell sounds every bit as hawkish as he did the last time he spoke, crypto will probably face another fresh round of selling, which of course will have this market testing those support levels underneath. I'm a longer-term investor, so I certainly hope that happens so that I can start to accumulate. But frankly, if you are bullish of this technology longer term, boring is what you are looking for.
