Ethereum Fails to Post Bullish Monthly Close, Opening the Gates for Downside
- Ethereum’s trend of underperformance against Bitcoin has persisted and is showing few signs of changing anytime soon
- The cryptocurrency has been unable to match the strength seen by BTC over the past few weeks, and it is still trading below its key $400 resistance level
- Where it trends in the near-term depends largely on Bitcoin’s reaction to $14,000, as a break above this level could send the entire market flying higher
- One analyst is now noting that he expects ETH to see some weakness in the near-term
- He is specifically watching for a potential decline to its first robust support at $270
Ethereum has been struggling to gain any strong momentum throughout the past few weeks. This stagnant price action has come about as Bitcoin enters full-blown bull territory as it pushes against $14,000.
Its price is currently struggling to break above $390 – as this level has held strong as resistance throughout the past few weeks.
Until this level is broken above and ETH can gain a foothold within the lower-$400 region, downside may be imminent.
One trader is noting that its relatively weak monthly close indicates that a decline below $300 could occur if it enters any strong downtrend.
Ethereum Struggles to Gain Momentum as Consolidation Persists
At the time of writing, Ethereum is trading up marginally at its current price of $388. This is around the price at which it has been trading throughout the past week.
The price region between $390 and $400 has long been a strong resistance level. Until it can break above this price region, it will likely continue underperforming Bitcoin.
Analyst: ETH Weakness Signals Move to $270 Could be Imminent
While sharing his thoughts on Ethereum’s near-term outlook, one analyst explained that its latest monthly close suggests further weakness could be imminent.
He also notes that a decline towards $270 could come about if it shows any signs of intense weakness.
“ETH update: I gave the bulls a 5-day headstart to fix the monthly but it looks like they couldn’t manage. Given we’ve both lost support & now bearishly retested the resistance I’ll assume the last 3 months were a false breakout. Resistance: $390. 1st support: $270,” he said.
Image Courtesy of DonAlt. Source: ETHUSD on TradingView.
If Bitcoin rallies past $14,000, it could start generating some tailwinds that help lift Ethereum and other altcoins higher.
A rejection at this level could spark a grave downturn for assets like ETH.
Featured image from Unsplash. Charts from TradingView.