I think this is a market that is going to try to “climb a wall of worry”, because clearly you can see there have been a couple of major shots across the bow.
The Ethereum market has been slightly positive on Tuesday as we continue to press up against the $3500 level. This is an area that will attract a certain amount of attention obviously, but at the end of the day you have to question whether or not we have momentum to finally break out. It certainly does not look like it at the moment, but that does not necessarily mean that we won’t to be able to.
I suspect that a short-term pullback might be in the cards, and the 50-day EMA which currently sits just above the $3000 level could offer a little bit of support, and the $3000 level itself will as well. This is a market that should continue to be a bit of a “buy on the dips” type of situation, and I certainly think that will be an area where we follow-through again.
Looking at this chart, you can also see that there was a shooting star that formed just above the $3500 level several weeks ago, and I think you need to break above the top of that wick in order to break free of a lot of the resistance. After that, then you have the $4000 level coming into the picture, where we had seen a lot of significant selling pressure previously. I think this is a market that is going to try to “climb a wall of worry”, because clearly you can see there have been a couple of major shots across the bow.
If we were to break down below the $3000 level, then it opens up the possibility of a move to the $2750 level, where we have seen a lot of support as of late. Breaking down below that then brings the 200-day EMA into focus, which is currently at the $2336 level and rising. That being said, I do not anticipate seeing that move, but I also recognize it is still very possible. In general, this is a market that I think continues to see a lot of volatility, but at the end of the day I think it is only a matter of time before buyers come back in to pick up some type of value.