Ether Drops Below $1K, Dragged Down By BTC Slide


The cryptocurrency market continues to be surprised by the sharp drop in the past week. Within 10 days, the ether had lost about 45 percent of its value.

On the four-day chart, the price of Ethereum (ETH) is now back to the all-time low of the RSI recorded in 2018 when the cryptocurrency was trading at $81.

On Saturday, ETH values ​​fell below critical levels and is currently trading in triple digits as the recent cryptocurrency sell-off continues.

According to data provided by Coingecko, at the time of writing, ETH is trading at $1,008, down nearly 40 percent over the past week.

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Ether drops as low as $997

ETH is currently selling for $997.61 on Etherscan, down nearly 9 percent over the past 24 hours. A breach of this support level is expected to lead to bigger losses for Ethereum.

Bears are in complete control of the market, and there are no major buyers. In a bearish scenario, if sellers force the price below $900, the potential demand area is between $700 and $900. Upon reaching this zone, ETH may enter an accumulation phase.

Right now, inflation, a volatile stock market, rising interest rates, and fears of a recession are fueling negative sentiment in the stock and cryptocurrency markets.

ETH total market cap at $122 billion on the daily chart | Source: TradingView.com

A shot at $ 1,700 in an upward scenario

On the upside, ETH will definitely approach $1,700 at steady resistance. The ability to overcome this barrier depends on the purchasing power of the market.

This possibility seems unlikely given that the current macroeconomic climate has caused investors to view riskier assets with skepticism.

Recent reports indicate that Ether developers have chosen to delay the network’s transition to a Proof of Stake (PoS) consensus while the bear market continues.

This improvement is expected to end reliance on Proof of Work (PoW) mining and Merge’s scalability solution, which has been in development for six years.

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Heavy market liquidation causes ETH to drop

The recent drop in ETH, the second largest cryptocurrency, is due to the liquidation of a large investment, possibly by Three Arrows Capital. The liquidation resulted in a large amount of ETH off the open market.

After the Federal Reserve raised interest rates by 75 basis points, the highest increase in the past three decades, the stock market rose Wednesday afternoon.

According to Edward Moya, chief market analyst at OANDA, the fact that the cryptocurrency market has not followed suit “is worrying some investors.”

Analysts estimate that Bitcoin and Ether could drop as much as 85 percent during bear markets.

Due to the impossibility of predicting the market and its timing, there is never an “ideal” time to buy cryptocurrencies. However, according to analysts, now might be a good time to enter the market because the prices are cheap.

Featured image from Arch20, chart from TradingView.com



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