On May 21, 2019, we analyzed Ethereum (ETH) and Ethereum Classic (ETC) to predict future price fluctuations. In the last two days, both ETH and ETC have broken down from their respective trading patterns.
Based on this new movement, we assess our predictions and amend them as necessary based on recent price movements and changes in the technical indicators. By comparing them to those observed yesterday, we are able to make a more thorough assessment of the cryptocurrencies.
MAY 21 ETH/ETC Analysis
Between May 17 and 22, ETH/USD had been trading within an ascending broadening wedge. On May 22, the price broke down from the wedge and has since been declining:
In our May 21 analysis, we wrote:
Given May 20’s bullish cross, ETH may experience slight increases inside the confines of the wedge. However, there remains bearish divergence in a bearish pattern. This suggests that a breakout is unlikely.
Our prediction was validated. Slight gains were seen until May 22 when the breakdown occurred. While we did not necessarily predict such significant losses, they were foreshadowed by the bearish divergence we observed.
The breakdown occurred with above-average volume.
Rebounding or Falling Down?
After the breakdown, the price found support above the 150-period MA. The MA coincides with the $230 support area formed by the lows of May 17.
Furthermore, the price created a bullish hammer candlestick characterized by a long lower wick, indicating that there is buying support near this area.
Therefore, we believe that the price will begin to increase toward the resistance area in the near future.
Subsequently, we believe that a new trading area will emerge within the support and resistance areas traced above. We predict that price will bounce between $230 and $260 in the short-term.
ETC Also Breaking Down
Between May 16 and 22, ETC/USD was trading within a symetrical triangle. Like ETH, a breakdown occured on May 22. Both have experienced continued price losses.
Also similar to ETH, ETC broke out with above-average volume.
Where To Next?
ETC has been trading above an ascending support line since mid-March. In the graph below, we can see that the price of ETC appears to be heading toward this line. To better assess this possibility, we’ve analyzed the RSI and MACD alongside the price.
At the current time, ETC is exhibiting significant bearish divergence in the RSI and MACD between the Apr 6 – May 16 and May 14-18.
In our previous analysis, we successfully predicted the breakdown from the short-term trading pattern and suggested that price would continue falling to the long-term support line.
While the breakdown has occurred, we are still awaiting the long-term support line to be reached. We expect the price to gradually fall over the next few days.
In the short term, ETH broke down from a broadening wedge while ETC broke down from a symmetrical triangle. Both breakdowns occurred with above-average volume.
However, while ETH has found support above medium-term moving averages, ETC has created very significant bearish divergence in the RSI and the MACD.
Therefore, we believe that ETC will continue its decrease while ETH may experience short-term gains.
A summary is presented in the table below:
|Ascending Broadening Wedge Breakdown||Symmetrical Triangle Breakdown||Tie|
|MA support||Long-Term Bearish Divergence RSI & MACD||ETH|
Do you think the price of ETC will continue to decrease? What about ETH? Let us know in the comments below!
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.