ETH To Fall Significantly Below $4K Following An Intense Selloff
There is a price correction in the crypto market, with BTC leading the altcoins in undergoing dipping prices.
ETH/USD 24-Hour Price Chart. Source: Tradingview
Notably, ETH dipped lower than its Q4 rising trendline support. Before surging to a higher price level, Ether had attempted to dip lower than its next support, as shown on the 50-day EMA. If it breaks this MA, its next support will be the $3.75K price range.
The Consequences Of The Rising Wedge Pattern.
The upward trendline support mentioned above is one of the results of the rising wedge pattern. Analysts often denote this structure as a sign of bearish reversal. This pattern often appears when an asset’s price keeps bouncing within a limit of two adjacent trendlines.
Rising wedge pattern on ETH/USD 24-hour price chart. Source: TradingView
However, once the price dips beneath the trendline’s low, and there is an increase in trade volumes, then a breakout from the wedge is likely. The length of this break is usually the longest distance between the wedge’s trendlines. Consequently, this wedge pattern indicates that ETH might dip lower than $3K. However, there is more to it.
A New Perspective
There is an ascending triangle that balances the bearish reversal structure caused by the rising wedge pattern. Therefore, ETH might trade at about $6.5K before the year ends. This bullish setup is appearing as ETH price aims to flip the triangle’s resistance to a support a few days after rising past it.
Ascending Triangle Setup On ETH/USD 3-Day Chart. Source: Tradingview
This ETH price action sifts out day traders and allows actual investors to make long-term investments since these long-term holders usually make their investments based on the asset’s strong fundamentals. Hence, ETH may trade lower than $4k once this current price correction is over. However, if a rebound should happen, ETH might embark on a new bullish run that will see it trade at over $6.5K.
Cheap Transactions, Solana And Ethereum
Many industry analysts suggest that sol might eventually rank second only to BTC and topple ETH from that position. Solana continues to attract users by enabling almost-instant transactions at a low cost. However, Ethereum’s other advantages cover up its high gas fees. Some industry experts, such as Adrian Kolody from domination finance (a custodial exchange company), opine that Solana cannot overtake Ethereum because Ethereum has more institutional investment than Solana.
Kolody also argued that Solana could best be categorized as a SpeedFi network compared to Ethereum, classified as a decentralized network. He further said that the only way Solana could take over from Ethereum is if Ethereum completely breaks its ETH 2.0 promises – an event that is unlikely to happen.
However, Pete Humiston, a top-level executive with Kraken intelligence, countered Kolody’s claims saying that Solana will overtake Ethereum as long as it keeps growing its network and expanding its developer and user base. While Solana provides cheaper transactions and more enticing features than Ethereum, ETH’s scaling solutions make it far ahead of Solana. But time will tell which is the second leading cryptocurrency.
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