Ethereum has been caught within some turbulence over the past week, with its price action largely mirroring that of Bitcoin and the aggregated crypto market.
Earlier this week, ETH plummeted from its recent highs of $280 to lows of $250, before finding some strong buying pressure that has allowed it to climb back to its current price region.
In the near-term, analysts are noting that Ethereum’s Bitcoin trading pair does appear to be highly bearish due to a myriad of different factors, including fading volume and rapidly growing resistance around its current price levels.
Despite this, other analysts are noting that there are still a few factors counting in ETH bulls favor.
Ethereum’s Momentum Stalls as Bulls and Bears Remain at an Impasse
At the time of writing, Ethereum is trading up just under 3% at its current price of $266, which marks a notable climb from recent lows of $250 that were set at the bottom of the recent flash crash seen amongst most major cryptocurrencies.
This sharp and highly unexpected movement seemed to temporarily invalidate the cryptocurrency’s bullish market structure, but its price action in the time since seems to confirm that bulls have still maintained their underlying strength.
Smokey, one popular cryptocurrency trader on Twitter, explained in a recent tweet that this strength is likely to lead ETH higher in the near-term, but he does note that it is a strong possibility that the crypto first retraces to $226 before starting its next sustained rally.
“ETH | USD | Weekly bullish too. If it retraces, 226$ is a buy in my opinion. Already worth punting a long on ETH imo in this ascending triangle formation. Either way, 350$ is the target,” he noted while expressing tempered bullishness.
$ETH | USD | Weekly
If it retraces, 226$ is a buy in my opinion.
Already worth punting a long on ETH imo in this ascending triangle formation.
Either way, 350$ is the target. pic.twitter.com/p7NON0zigZ
— TraderSmokey (@TraderSmokey) February 21, 2020
In spite of this, it is imperative to keep in mind that there are multiple factors counting against Ethereum in the near-term, with declining volume, a bearish rising wedge, mounting resistance, and more all pointing to the possibility that further losses are imminent.
Bitcoin Jack, another prominent crypto trader, spoke about these factors in a tweet, telling his followers that he believes Ethereum is a “strong short setup.”
“ETH vs BTC >Plausible impulse down after the top >Top can be argued to be wave 5 of wave >Followed by a rising wedge >In to daily resistance >Fading volume. This is a strong short setup at daily resistance,” he said.
$ETH vs BTC
>Plausible impulse down after the top>Top can be argued to be wave 5 of wave 1>Followed by a rising wedge>In to daily resistance>Fading volume
This is a strong short setup at daily resistance pic.twitter.com/ilBGFzCeS9
— //Bitcoin 𝕵ack (@BTC_JackSparrow) February 21, 2020
Whether or not the drop resulting from these bearish factors ends at the crypto’s key support around $225 should provide valuable insights into where the crypto is going next.