The price of the second-biggest cryptocurrency Ethereum price plunged under $230 in spite of having a nice recovery from last week’s low at $225, meanwhile, Bitcoin is also in red. The upside was capped at $240 mostly by a decreasing trendline resistance and the 100 SMA in the 1-hour range.
The price went above the 50 SMA but have missed the momentum to bolster these gains. Losses below the 50 SMA were obviously too much because it led Ether to fall below $230 for the second time in less than just five days.
At the time of writing, ETH/USD is trading at $224 after losing 5.07% of its worth today. If losses went on, a double bottom pattern could be anticipated now and could lead to gains above $240.
For now, the path of least resistance remains to be falling, especially when looking at the technical indicators. The RSI, for the example, is again at the oversold region where it hasn’t been from June 11.
Ethereum Price Will Jump if Bitcoin Hits New Records
Nevertheless, the MACD features a negative divergence as Ethereum loses its traction against the dollar. If the technical picture stays the same in the near term, we could expect ETH/USD to fall even more and test support at $220 and $210 respectively. That means that the path with the least difficulties remains downwards, for now.
Ryan Selkis, chief executive of crypto researcher and data provider Messari, says that the introduction of decentralized finance gives “ETH a higher ceiling” to rise in the long term.
Let’s just remind us that the open interest on Ether futures contracts went up by 67% during the last two months to $671 million as measured by data from Skew.
All it is important to say that every futures contract trade needs a buyer and seller of the same size, meaning there is no way to infer what net exposure professional traders are aiming for.
“Liquid futures markets provide an instrument for large investors to quickly build positions or hedge existing ones. This open interest increase is definitively a sound signal of professional investors’ appetite but it would be a mistake to simply conclude that increased institutional investor participation means investors are bullish Ether’s future value.”
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