ETHXBT Price Technical Analysis – Short on Pullbacks

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ETHXBT continues to trend lower, moving below a descending trend line on its 1-hour time frame. Price has been pulling back to this falling resistance level and resuming its slide to new lows so it would be a good idea to sell on these corrections.

The 100 SMA is below the longer-term 200 SMA on this time frame so the path of least resistance is to the downside and the selloff could carry on. In addition, the 100 SMA dynamic resistance is in line with the descending trend line, which adds to its strength as a ceiling.

The gap between the moving averages is widening so bearish pressure is getting stronger. If the trend line resistance around 0.01750 keeps gains in check, ETHXBT could head back to the previous lows at 0.01625 or create new ones closer to 0.01600.

RSI is still on the move up to suggest that bulls are in control of price action for now or that bears are taking a break and booking profits off the latest drop. Once the oscillator reaches the overbought zone and turns lower, sellers could return to the game. Also, stochastic is starting to turn higher on its way down but might be ready to point lower again.

Positive developments in the bitcoin arena have been supporting this particular cryptocurrency across the board lately, even as risk appetite has been picking up. Ethereum, on the other hand, is still bogged down by security issues in its network and the adjustments owing to the implementation of a hard fork.

For now, traders seem less inclined to invest in ethereum given the vulnerability to attacks while bitcoin has been enjoying increased inflows from Chinese funds.

To contact the reporter of the story: Samuel Rae at samuel@forexminute.com
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Samuel Rae is an active retail trader across a variety of assets, including currencies, stocks and commodities and the author of Diary of a Currency Trader (Harriman House). His personal strategy focuses primarily on classical technical charting patterns with a fundamentally supportive bias, combined with a strict, risk management-driven approach to entries and exits. He is an Economics graduate from Manchester University, UK.