- Ethereum rallied Friday, but there is also a significant amount of resistance above that continues to cause major problems.
- The major source of resistance is the $1800 level, which extends to the $2000 level.
- Because of this, I think we still have a lot of concern out there when it comes to any type of rally.
Ethereum Likely to Struggle
Ethereum is going to continue to be somewhat bullish in terms of crypto markets, mainly due to the fact that “The Merge” is coming, and it could bring in good things for the network. The reality is that there is still a lot of work to be done before you can clear all of this noise above, so I think Ethereum will continue to struggle in general. If the market were to break down from here, there are a couple of places where I would expect to see support, not the least of which would be the 50-day EMA which is sitting just above the $1200 level.
The $1200 level is an area that extends down to the $900 level and has been a massive support. If we were to break down below that level, then it’s likely that we could go much lower. At that point, it’s likely that we would see Ethereum drop drastically. I think given enough time, we will eventually try to build up enough momentum and reason to go higher. Ultimately, this is a market that will continue to see a lot of volatility.
The market will continue to be very noisy, but I think more than anything else we will continue to see a lot of questions when it comes to risk appetite. Keep in mind that the risk appetite is going to drive what happens in this market. This is the same with all crypto, which has been trying to build up a little bit of a presence, but right now it’s been difficult to get a bit of momentum going. With this being the case, I think you will continue to see a lot of back-and-forth, and then eventually momentum. I do think that we will see the market recover, but I’m not convinced that we are there quite yet. That being said, buying on dips could be used as a way to pick up a little bit of value here and there for a longer-term position.
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