Ethereum (ETH) Caught Between Rock And A Hard Place Once Again

Ethereum (ETH) Caught Between Rock And A Hard Place Once Again

Ethereum (ETH) keeps finding itself in tricky situations. It depends on Bitcoin (BTC) for a decisive breakout to either side but the fact that it has now become range bound once again after a strong move to the upside means that traders will be all confused again as to the direction ETH/USD is going to head next. So far, the price remains below $134.95 and above $126.90. Ethereum (ETH) could continue to trade in this range for a long time. That means that it does not have to make a decision any time soon. A breakout from this range whether to the upside or to the downside is going to be of high significance because it will determine whether the downtrend will continue or not.

At this moment, there is nothing much to be bullish about until we have a decisive break past the $135 level. If that does not happen, we can expect a decline down to the $126.9 level once again. In that case, ETH/USD would have formed a double top and would be positioned to decline further. However, before that happens, the price could still break to the upside. The RSI and Stochastic indicators on the 4H chart indicate that there is ample room for such a rally. However, whether or not Ethereum (ETH) does rally will depend on what Bitcoin (BTC) does next. We have recently seen Bitcoin dominance (BTC.D) rise but it has yet to test the 200-day moving average. Meanwhile, Ethereum dominance (ETH.D) has been declining but if we see the market break higher from here, the trend could soon reverse.

Ethereum dominance (ETH.D) has printed its first green candle after more than week of continuous downtrend with no sign of any relief. It is now possible that we might see a retest of the 8.23 level and therefore the previously broken symmetrical triangle. Such a retest would be key to the price taking a definitive direction. If we see a rejection, Ethereum dominance (ETH.D) could be expected to decline much lower long term.

The next trend in Ethereum dominance (ETH.D) is of much significance because it will determine how the altcoin market performs. At the moment, Bitcoin (BTC) is leading most rallies registering the highest gains among all large cap coins. However, if we see a move towards the 8.23 level in Ethereum dominance (ETH.D) that might be a time when altcoins including large cap coins take the lead and see a brief period of upside before the next potential downtrend. This could stall the next downtrend by several weeks or a month or two but Ethereum (ETH) is highly likely to resume its downtrend when the dust settles.

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