Buying Ethereum After the Retrace in the Crypto Market
Skerdian Meta • 2 min read
We have been witnessing a crypto winter since last November, when the market reversed lower as a result of the continued war on cryptocurrencies, which has been weighing on this market. BITCOIN (BTC) fell below the $20,000 level by the middle of June, but since then the situation has improved and most crypto coins have been making some decent gains, with BTC forming an upward channel.
ETHEREUM pushed above the 50 daily SMA (yellow) which then turned into support after the price was rejected at the support and resistance level around $1,700. That was the first bullish signal and buyers pushed above the $1,700 level, but the 100 SMA (green) turned into resistance after that, while the 20 SMA (gray) turned into support. The range was narrowing and the breakout eventually took place to the upside.
On Monday Ethereum pushed above $1,800, while in the last few sessions sellers returned again. I couldn’t find a reason for that, so this is just a retrace before the next bullish move higher. Although let’s see if the 100SMA (green) will hold as support on the daily timeframe.
Ethereum Daily Chart – MAs Turning Into Support
Will the 100 SMA hold as support now?
On the H4 timeframe, Ethereum looks bullish and the latest retreat lower looks just like another pullback before the bullish momentum resumes again. We decided to open a crypto signal on this cryptocurrency, as the stochastic indicator is oversold here.
Ethereum H4 Chart – MAs Holding on Retraces Lower
The uptrend will continue if the 500 SMA holds
We are keeping a bullish bias for Ethereum as the Ethereum blockchain’s planned Merge, an upgrade that changes it from a proof-of-work (PoW) system to a more environmentally friendly proof-of-stake (PoS) mechanism is approaching. There will be quite a few consequences, such as lower energy intensity, the transition into a deflationary asset and a potential road map to a more scalable future through sharding.