Ethereum, like his big brother Bitcoin, eventually fold as the big picture outlook is starting to look more and more bleak with global growth endangered by the Chinese ailing economy and lack of big stimulus from the authorities, and the “higher for longer” stance from the Fed or even more rate hikes. The resilience in the cryptocurrency has been remarkable in the past months, but we might be at a tipping point now.
Ethereum Technical Analysis – Daily Timeframe
On the daily chart, we can see that Ethereum after breaking below the strong support at 1816 where we had also a key trendline, sold off very strongly and even fell below the key 1681 support. This has opened the door for much lower prices ahead with the next target coming around the 1370 level. We will likely see the sellers piling in at every rally from now on.
Ethereum Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that we now have a strong area around the broken support turned resistance at 1681. In fact, we can see that the price tried to rally past the level but got rejected multiple times. If the price comes back there, we can expect the sellers piling in again with a defined risk above the level and target new lows. The buyers, on the other hand, will need the price to break above the resistance to open the door for more upside and target the 1816 level.
Ethereum Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we have some minor key levels that might attract the sellers. The first one is the recent swing low at 1648 where we may see the sellers piling in with a tight risk above the level. Otherwise, more conservative sellers, may want to wait for the price to take out the recent low at 1580 before joining the downtrend.
Upcoming Events
This week is pretty empty on the economic data side as we will only have the PMIs today and the US Jobless Claims tomorrow. Strong data should support Ethereum in the short term, but the prospects of more rate hikes might weigh on the cryptocurrency soon after. Conversely, weak data is likely to cause some recessionary fears in the markets leading to negative risk sentiment and eventually weighing on Ethereum. Remember also that this is the Jackson Hole Symposium week, so we will hear from many central bankers including Fed Chair Powell, who is set to speak on Friday.
