Is Ethereum Dropping To Three Digits?

The Ethereum (ETH) chart shows a five-day losing streak which undermines last week’s recovery rally. Furthermore, the falling price potential breakdown from $1000 psychological level, indicating the sellers attempt for another leg down. 

Key points: 

• Sustained selling should lead ETH price to $900.
• The Bollinger Band indicator’s midline gives constant resistance to ETH price.
• The intraday trading volume in Ethereum is $12.3 Billion, indicating an 11% loss.

Source- Tradingview

A drastic fall from early May to mid-June plunged the ETH/USDT pair to a low of $896.6. Having said that, the weekly candle managed to close above the combined support of $1100 and the 0.786 Fibonacci retracement level amid the recent relief rally.

However, the recent news regarding the crypto hedge fund Three Arrows Capital plummeting into liquidation has brought significant selling pressure on the crypto market. As a result, the ETH price reverted from the $1272 mark and initiated a downward approach.

The V-top reversal plunged the altcoin by 18.3%, which currently trades at $1032. Furthermore, the five consecutive red candles in the daily chart represent aggressive selling, challenging the $1000 support.

Thus, a daily-candle closing below the $1050-$1000 support would extend the downward spiral to June low support of $900-880.

However, the safe traders can wait for a weekly candle closing below $1100 to confirm a bearish breakdown. 

Technical indicator-

Since early April, the Bollinger Band indicator’s midline has acted as dynamic resistance for ETH price. Moreover, a recent reversal from the neutral slope indicates the sellers are in command. 

A vortex indicator shows a bearish crossover of the VI+ and VI- lines, providing an extra edge for short-sellers. The expected spread between these lines should validate the sellers’ commitment to this downfall. 

• Resistance level- $1300, and $1424
• Support level- $1000 and $880