Ethereum has rallied ever so slightly during the trading session on Thursday, as we continue to cling onto the $2000 level. Quite frankly, this looks like an act of desperation and I do not see how this stabilizes for the longer term. I believe it is only a matter of time before we break down, and if we break through that nasty hammer from several days ago, that opens up the floodgates to much lower pricing. This would not be a surprise to me at all, crypto has a lot of major issues right now, and I think that is going to continue to be the case.
Ethereum seems like it is constantly in a state of “just wait until Ethereum 2.0 gets finished”, thereby constantly having something to look forward to. In a major “risk off market” that we find ourselves in globally, it is difficult to get excited about something that has taken forever to implement some of its designs. Because of this, I think that Ethereum will continue to struggle, especially if Bitcoin continues to be absolutely miserable. It is essentially looking like we are heading towards a “crypto winter”, which is a great investing environment, but for the short term it means that you are not going to see much in the way of positivity.
If we did break higher, breaking above the $2100 level might cause a short-term rally. However, the $2500 level would almost certainly be an area that the market would struggle with, and therefore I think you would have to be very cautious about getting overexposed. I believe it is much more likely that we break down and have an opportunity to buy Ethereum at $1500, and then again maybe even at $1000. Remember, it was not that long ago that Ethereum was trading around $300, something that could be very possible if the negativity keeps up. If Bitcoin breaks down below its current trading range, Ethereum is going to get eviscerated. Smaller markets are going to be in even more trouble. There is absolutely nothing on this chart that compels me to get involved at this moment, but I do recognize that if we get enough negativity and a complete wipeout, it could lead to a nice longer-term investing opportunity. It is difficult to imagine making a lot of money trading crypto to the upside anytime soon.
