ETHUSD Analysis: a Controversial Consensus
Updated ETHUSD trading scenario. Is Ethereum worth buying? Where will the most popular altcoin stop falling down?
In this post I applied the following tools: fundamental analysis, all-round market view, market balance level, volume profile, trendline analysis, candlestick patterns, Kagi chart.
Dear friends,
Today I’m going to offer you Ethereum price prediction and ETHUSD analysis. Ethereum is surprisingly weak, even amid the bearish market. Currently, ETHUSD is at the level, which hardly anyone has ever expected.
What are the reasons for such a deep dive? What is the most popular ETH altcoin promising in future? I’ll try to find out.
Previous ETH scenario
First, let’s see whether the current market situation corresponds to the scenario, I suggested in my last Ethereum price forecast.
(scenario dated 22.08.2018)
(ETHUSD today, 07.09.2018)
As it is clear from ETHUSD chart above, the ticker was consolidating less time than I had suggested. The bearish channel, to my surprise, has retained its strength, driving Ethereum price inside its borders.
Ethereum fundamental analysis
As you see from the chart above, Ethereum cryptocurrency is still performing worse than the rest of the market. Moreover, there is a clear strong drop, go on over the last few days, when Ethereum has been another 20% down.
The last hit on Ethereum price was delivered by the news that Goldman Sachs denied the information about its plans to launch its own cryptocurrency platform, calling it a fake.
However, Ethereum grew weaker much earlier. The ETH price started to strongly deviate from the rest of the crypto market in late July, 2018.
If you study the history of the news, associated with Ethereum, you’ll, first of all, notice the information about ETH future hardfork, Constantinople. There were announced the plans to launch the updating before the Devcon4 conference will start on October 30.
The most important Constantinople feature will be another step towards the switch from POW to POS-consensus, involving a lower mining reward of 2 ETH, compared to 3 ETH previously.
Of course, miners don’t like the situation, as the Ethereum mining should yield less and less profits.
As you see, the yield for 1 Mhash per second is currently at its all-time low. However, taking into account the changes, resulting from the hardfork, it is not the limit. Because of this, many Ethereum miners, using graphic cards, are likely to be at a loss. They just have nothing to do but to start mining other cryptocurrencies.
Disappointed miners create rather negative background around Ethereum, which results in the weakness of ETH buyers.
Is it really that bad?
To find out, let’s look at its last hard fork Byzantium, occurred on October 16, 2017.
It is clear from the chart above, after the hardfork had been complete, whales were accumulating positions, which was followed by ETH sharp surge up to 1400 USD for one ETH.
A decline in the block cost to 3 ETH, from 5 ETH, much reduced the inflation rate in the Ethereum network; it, in addition to major improvements, introduced by the network update, sent the ETH price up. A similar situation may occur this time; as, in addition to a whole pack of improvements, after the update, the reward will be down to 2 ETH, from 3 ETH. It will surely reduce inflation and is likely to send ETHUSD price up in the end.
Ethereum technical analysis
Let’s see what ETHUSD all-round market view suggests.
As you see from ETHUSD monthly chart above, the ETH ticker has closely approached to the key level at 198 USD. The next Ethereum strong support level will be at 136.12 USD; at the same level is Keltner channel’s bottom border, and so, the price will move below the level very slowly, in case it does.
To assess more accurately, how much the ETH price is likely to break out the first and the second support levels, I suggest looking at a shorter timeframe.
As you see in ETHUSD weekly chart above, RSI indicator is down in the oversold zone, but it isn’t yet sending any reversal signals. Neither is MACD sending any bullish signals. In general, it suggests that correction can well continue in the near future.
In Ethereum daily chart above, the situation is completely bearish. As I’ve already said, the ticker is back in the bearish trading channel; and both MACD and RSI stochastic are pointing down, and they still have some room to go lower.
In the ETHUSD four-hour experimental chart, the situation is definitely bearish; it is indicated by both candlestick chart on the left and the Kagi chart on the right.
All indicators suggest the price go down: MACD and its graph-bar in the Kagi chart are reversing downwards; the Kagi itself is red.
Updated ETHUSD trading scenario
Technical analysis suggests ETH price should continue going down; and the approaching Ethereum hardfork may increase the pressure. However, after the fork is complete, Ethereum is quite likely to meet a strong support that can well drive it up rather high.
Nevertheless, there are going to be many important events, connected with Ethereum in the near future, including ETHGlobal Hackathon, Ethereum Industry Summit and Blockchain Tech Meetup. All these events will be held in the next few days with very short intervals between them; this fact can support Ethereum rate at the current levels, or may even let ETH rebound.
However, the general ETHUSD trend will be bearish as long as the ticker is moving in the bearish channel and doesn’t move above the current support zone that is between 221 USD and 199 USD.
The Ethereum target for September, and maybe the point of the global trend reversal, is still at about 136 USD.
That is my ETHUSD trading scenario. Go on following the Ethereum price and staying informed on the cryptocurrency market. I wish my ETH price predictions are useful for you!
I wish you good luck and good profits!
Regards,
Mikhail @Hyipov by liteforex.com
