Ethereum has now lost its hold on an important level. This decline follows that of bitcoin which has now fallen below $20,000. However, for Ethereum, the fight continues to hold on to the one point where bulls still see some hope. However, with the way the market is moving, it may not be long before Ethereum is testing the critical $1,000 support level.
For Ethereum, holding above $1,100 for the past week had meant that there was still hope for a good run-up that could see it retest the $1,500 resistance. But this would only last just a little above $1,200 before it lost steam and was once more on another decline.
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With the opening of the new week, the decline in prices has hit Ethereum hard and the price had easily broken through the support at $1,100. Now that the price sits below this point, it continues to push on whatever support is being established below it.
Given that the digital asset continues to skew towards 100% sell, there may not be much support forming for ETH. This is because the sell-offs have refused to reach a fatigue point. It means that bears can still pull down the price of ETH.
ETH falls below $1,100 | Source: ETHUSD on TradingView.com
Ethereum has now fallen below its 20-day moving average, a metric that had been setting the digital asset for a bullish short term. Instead, the pull-down has now brought the next major support level to $1,050, a point which the digital asset continues to hold above but remains hard to climb from here.
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Most of Ethereum’s gains had actually come from the anticipation of the Merge which is expected to happen sometime this year. However, it looks to be turning into a buy the rumor and sell the news situation given that all of the ETH locked will be unlocked when the merge happens. Nevertheless, as the merge draws closer, the digital asset is expected to see more recovery.
As for where the decline ends, it is possible that Ethereum may still have not seen the bottom of the market. Going by historical data shows that at least an 80% decline is expected before the bottom is in, and so far, ETH’s price is down 78% from its all-time high. It is expected to drop as low as $500 before the next bull market resumes.
Featured image from Anioma Press, charts from TradingView.com
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