I think you need to keep an eye on the Federal Reserve, and where we are likely to head next.
- Ethereum pulled back a bit Monday, as it looks like we are going back and forth and trying to figure out where we are going to go next.
- Looking at this chart, it would not be a huge surprise to see if we break down below the $1500 level.
- It’s likely that we could go to the 50-day EMA, which is just above the $1200 level.
The $1800 Level
Even if we were to rally from here, I think the $1800 level will be a significant resistance barrier, and therefore I think that if we do get to that area, there will be a lot of profit-taking and/or selling pressure. That begins a significant resistance barrier that extends to the $2000 level, and therefore I think it’s going to take quite a while to get through all of that. If we could break through the $2000 level, then it’s likely that the market could go much higher. At that point, I would anticipate the market would enter a bullish phase, but I think that is a little bit difficult to get past.
“The Merge” is a major factor in what we have seen as of late, and the expectation that it is going to happen in September. However, we have seen Ethereum disappoint more than once, so don’t be surprised at all if it happens again. The market will more likely than not pull back from here, perhaps reaching that 50-day EMA. If we break it down below there, it’s very likely that we will head back into the previous consolidation area. If we break it down below that level, then it’s open season on Ethereum, and we will probably drop down to the $400 region. At that point, I am more than willing to start building up a huge position for a longer-term setup.
If we break above the $2000 level, I’m not really sure what I would do in that scenario, because it does not necessarily jive well with the fundamentals of anything at this moment. Because of this, I think you need to keep an eye on the Federal Reserve, and where we are likely to head next. The Federal Reserve is rather tight, and that does tend to work against risk appetites, and thereby work against crypto.
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