Ethereum felt rather significantly during the trading session on Friday, as we have seen a decidedly “risk off” type of environment. In fact, Ethereum is down almost 6.5% for the session, as we continue to see Ethereum move back and forth with the overall risk appetite of traders around the world, and of course Ethereum continues to be very far out on the risk appetite spectrum, and that of course means that Ethereum will fall significantly anytime that the rest of the market breaks out.
Trump Tweet
Donald Trump decided to tweet and complain about the way the Chinese are negotiating, which has sent risk appetite plunging. This obviously has a “knock on effect” in several markets, including Ethereum. After all, if there are concerns about other markets, if you have massive gains in Ethereum, you probably look at this through the prism of a market that probably has to cover massive losses elsewhere. After all, technology stocks absolutely crumbled, and therefore it’s likely that Ethereum would follow suit.
That being said, the $4000 level is sitting just below, and I think there will be people out there willing to get involved in trying to defend that level. The $3900 level sits below there and could potentially offer support as we had bounce from there previously. At this point, if we break down below the $3900 level, then it’s possible that the market really starts to fall apart. On the other hand, if we bounce from here over the weekend, then it’s likely that Ethereum will try to get back to the 50 Day EMA near the $4287 level, and then possibly even the $4750 level.
As things stand right now, it’s likely that we are still in the middle of a major consolidation area, and therefore I think you need to look at this is a market that is still very much range bound, despite the fact that we have seen such a massive beating during the trading session on Friday. That being said, we could see a nice opportunity given a chance.
Potential signal: I’m a buyer of Ethereum if we break above the $4200 level with a stop loss of $4000. I’d be aiming for the $4550 level.
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