Ethereum Classic ETC price closed last week with an inside week on the bar charts and a 27% gain after collapsing 45% the previous week. The Ethereum Classic ETC rebound did not introduce an overbought reading on any appropriate timeframe, indicating that the price decline since May 26 is not the beginning of a new leg lower. Instead, it is a simple, quiet release of the ETC price compression provoked by the series of sharp declines and ETC rebounds the preceding days, placing the cryptocurrency in a timely position moving forward.
From the May 6 high at a price of $158.76 until the May 19 low, Ethereum price erased 75% of ETC value, including a drop of 55% at the May 19 low. The Ethereum Classic volatility was an extraordinary reversal of fortune for investors. Before the correction, the ETC price had registered a 1,200% advance over the previous six weeks after breaking out from a symmetrical triangle pattern at the beginning of April. Nevertheless, the Ethereum Classic ETC price is on pace to close in May with an 85% gain.
A bullish outcome of the historic price correction was removing the overbought readings on the daily and weekly Relative Strength Indexes. It positioned Ethereum Classic ETC price to stage a meaningful rebound in a short period.
Ethereum Classic ETC price made a statement on May 24, closing up 42%, the largest daily gain since May 2017. The sharp price bounce could not overcome May’s declining trend line on a sustainable basis, and ETC price fell into the current decline and within the boundaries of a descending channel.
A close above the junction of the 50 four-hour simple moving average at $69.41 and the channel’s upper trend line at a price of $69.65 would spark a renewal of the bounce from the May 23 low, boosting ETC price to the 200 four-hour SMA at $78.52. Once the critical moving average is disposed of, Ethereum Classic will not face significant resistance until the confluence of the May 26 high at $84.08 and the 38.2% Fibonacci retracement level of the May correction at $85.36.
If the ETC price extends the rally, Ethereum Classic should rise to test the 50% retracement at $99.38 and the psychologically important $100.00, representing a 45% price gain for the cheaper Ethereum.
Other resistance level points of interest include the 61.8% retracement at a price of $113.94, the all-time high at $158.76 and of course, the 361.8% extension of the 201-2019 correction at a price of $161.33, offering a 140% profit for committed ETC investors.
A close below the channel’s lower trend line at a price of $56.70 will sabotage the bullish narrative. Additional selling will not meet the support level until the 2018 high at the price of $46.98. It would signify that Ethereum Classic ETC price is building a more complex bottom or potentially pursuing a much deeper correction.
During the price correction, there has been a sizeable contraction in social volume on a short-term basis, but from a larger perspective and on a smoothed basis, it remains at the highest support level since 2016.
The Santiment social volume metric calculates the number of mentions of the coin on 1000+ crypto social media channels, including Telegram, cryptocurrency subreddits, discord groups and private traders chats.
Ethereum Classic ETC price had an incredible run in April and early May, lifting social media volume to historic highs. However, the sharp price correction in May still hasn’t compressed the smoothed social volume metric to past levels. It suggests that April-May’s type of price action that augments social volume will not be duplicated any time soon, so traders should be prepared for incremental rallies with extended periods of sideways price action.
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