The Ethereum (ETH) price is on the decline once again after recovering to as high as $137 across major exchanges. The pullback comes after technical indicators pointed towards an upsurge to $170.
Declining momentum of the bitcoin price in anticipation of a gloomy U.S. stock market opening on Monday is likely to be causing the cryptocurrency market to slump.
Ethereum had an optimistic short-term outlook
According to cryptocurrency trader Josh Olszewicz, a technical structure called E2E and an abstruse inverse head and shoulders (IHS) formation on lower time frames initially pointed towards an optimistic short-term price trend for ETH.
During weekends, however, the volume of the cryptocurrency market tends to decline. As such when the price of major cryptocurrencies like Ethereum and bitcoin start to rise while volume declines, it often indicates a fakeout before a large drop.
In times of uncertainty, alternative cryptocurrencies tend to follow the price trend of bitcoin. When the price of bitcoin drops, Ethereum and other major crypto assets are likely to see intensified movements to the downside.
In the short-term, technical analysts expect the bitcoin price to retest the low $5,000 region again at the least, following the rejection of $6,200 on March 22.
Cryptocurrency trader Michael van de Poppe said:
“[Bitcon] having it’s problems with the $6,400 level already. There’s still two scenarios that I’m watching. Either we’ve got a fake rally and make a LH here, through which we test the $5,280-5,400 level for support. Or we break up and take the highs and do the same.”
At a technical level, the rejection of $6,200 is expected to lead to…