- The Ethereum market struggled a bit Monday as we continue to see the $1800 level above offer quite a bit of resistance.
- The market looks as if it is more likely than not topping out for the short term, as Ethereum got a little bit ahead of itself.
The $1800 level has been imported a couple of times and certainly offers quite a bit of supply. You can see that we shot straight up in the air to reach the $1800 level, and then have pulled back in more of a grind lower. At this point, you have to ask yourself the simple question: “Which one of these is more likely to be more sustainable?”
Economic Impact
Ethereum has gotten a bit of a boost due to the idea that upgrades are coming by September, but we have been disappointed by Ethereum more than once. Quite frankly, as long as there’s a lot of concern out there when it comes to the economic outlook, that has a lot to do with what happens with crypto. Remember that crypto is far out on the risk spectrum, so we need to see a lot of money flowing into the “hot markets” that make up the crypto world.
The 50-day EMA sits just above the $1200 level and is starting to curl higher. It’s sitting on top of the previous consolidation area, so I do think that the 50-day EMA could come into the picture to offer support. If we were to break down below there, then it’s likely that Ethereum will test the lows. On the other hand, if the market were to break above the $2000 level, it’s possible that we could go much higher. At that point, if the market were to break above the $2000 level, it would be a major shift in this market, perhaps opening up the possibility of a longer-term bullish run. That being said, I don’t necessarily think that’s going to be easy to happen, but it is something that we need to keep in the back of our mind. A strengthening US dollar could be one of the major downfalls for this market as well, and of course risk appetite in general is a very fluid situation overall.
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