Ethereum price drops to dangerous point: Newsbit analyst shares expectations

The crypto market is having a hard time. Although Bitcoin (BTC) gets the most attention, it is also important to keep a close eye on Ethereum (ETH). ETH generally leads the altcoin market and is therefore a good indicator for the broader altcoin market. Technical analyst Erik Juffermans from Newsbit takes a sober look at the graphs.

Clear view on daily chart

On the daily chart the picture is quite clear. ETH broke through our purple support zone at around $3,650 at the beginning of this month. After a short retest, the price fell even deeper and has even fallen to a level of $ 2,700 in the past week.

We are a very clear channel on the daily chart. An upper limit of $4,700, a midline around the $3,650 zone, and a lower limit around the current level around $2,700. This lower limit acted as strong resistance from May to July. When the price finally broke through here in July, we saw a rapid rise to around $3,900 and then a continuation to $4,900.

What does the big picture say?

So we have arrived at a crucial level. This can be seen even more clearly on the weekly chart below. The current zone has proven relevant over the past two years. So now too we could expect a reaction in the current zone. This does not mean that the price is guaranteed to reverse immediately. However, it does mean that the formation of a bottom in the current zone is a great possibility.

We also see that the Relative Strength Index (RSI), a well-known momentum indicator, is very low. Only once in the current bull run has the weekly RSI been lower than it is now. In recent years we usually saw a reaction around such low RSI levels.

Then we take a look at the ETH/BTC graph. We see that this graph has also reached an important level. The level around 0.032 previously acted as resistance and is now being tested as support. We want to see a response here for the continuation of the ETH bull run. If the ETH/BTC graph falls through this, it would be bad news. The graph will probably have to choose a direction in the coming days.