Ethereum fell again on Wednesday as the market is now threatening the $1100 level again. At this point, I would anticipate that Ethereum should go down to the $1000 level where it will look for more support, an area that should be crucial. If the market were to break down below that level, then it opens up the floodgates.
At this point, I believe it is probably only a matter of time before we see the market break through the $1000 level, because there’s no reason to think that the crypto markets are suddenly going to turn around. After all, the risk appetite of investors has been crushed due to tightening monetary policy and a concern about a global recession. In that environment, it’s very unlikely that crypto will do very well. Ethereum also has a few particular issues, not the least of which would be the fact that the rollout of the upgrade seems to be taking forever.
The technical analysis suggests that the $1200 level continues to offer significant resistance, and the $1000 level has a lot of psychology attached to it, and also had seen the market bounce from there previously. I do think that if we give that up, it’s very likely that Ethereum starts to drop rather significantly again, perhaps testing the $900 level, an area where we bottomed out recently. Clearing that level to the downside would be potentially disastrous, and really put the hammer on the market.
A lot of this will come down to how Bitcoin behaves because it does move the rest of the market in general. As long as Bitcoin is struggling, Ethereum doesn’t really have much of a chance. That being said, it is worth watching Ethereum anyway, because it is the leading “altcoin”, and the rest of the smaller markets will take their cues from this one. The Federal Reserve is going to continue to tighten monetary policy, and with the disastrous economy ahead of us, it’s very likely that crypto will continue to suffer. Because of that, I think you have a great opportunity to pick up crypto “on the cheap” at lower levels, and I don’t necessarily feel much desire or need to jump into this market. Even if we broke above the $1200 level, the $1600 level will be difficult to overcome after that.
