Technical Analysis and Market Entry: Ethereum Classic Set For Another Steep Fall

Ethereum Classic
  • Ethereum Classic has been falling for six consecutive weeks, having dropped a whopping 75%.
  • ETC/USD price action is subject to further downside pressure, given bearish technical structure.

ETC/USD: Recent Price Behaviour

Ethereum Classic has been taking a heavy beating, the price dropping for six consecutive weeks. Before the big bear market, ETC/USD was trading up at the heights of $13.00 but has recently dropped as low as $3.50. It has been forced to its lowest levels that had seen since December 2019, when ETC commenced a recovery.

The above-detailed fall equates to a whopping 75%, a chunky decline that is somewhat reminiscent of the 2018 bear market. It comes after such a promising- start to 2020, commencing a strong bull run. There was a strong signal provided to the market, that a trend change was coming.

A bearish evening star formation was seen at the close of 3 February week; it was placed right at the top of the bull trend. The firm confirmation was the following week’s performance, which saw a strong bearish close in the red. Since, ETC/USD has been firmly in a downward trend, at the mercy of much FUD.

ETC/USD weekly chart.

Board Member Resignation at Ethereum Classic

It has been reported that a board member of the Ethereum Classic Cooperative has resigned.

James Wo, did detail that his resignation is due to a disagreement with the organization’s executive director Bob Summerwill. In terms of Ethereum Classic Cooperative, they are a Digital Currency Group-backed research organization focusing on the development of Ethereum Classic.

Wo said in a statement:

I regret to say that, as a matter of principle, I must resign from the Board, effective immediately, because of gross mismanagement. I have reluctantly concluded that the executive director, Bob Summerwill, lacks the integrity and judgment needed to build the organization.

Trade Recommendation

ETC/USD 4-hour chart.

Price action via the 4-hour chart view has formed a bearish pennant structure, which is subject to a breakout south. ETC/USD has been moving within this pattern since 12 March, narrowing and edging towards a breach.

Given the above-detailed bearish pattern, deeper moves to the downside remain attractive. An entry around the current market price, in anticipation of the surge of momentum to come from the bears. Targets eyed at; $3.50, $3.00 and then $2.50. Stops to be placed above the pennant at $4.95.

Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Author:
Ken has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.