As mentioned in the previous update, ETHXBT has found resistance at the falling trend line and the Fib levels on its 4-hour time frame. Price has shown more bearish momentum and might be headed for the previous lows around 0.01300.
The 100 SMA is below the 200 SMA, signaling that the path of least resistance is to the downside. The gap between the moving averages is widening so bearish pressure is getting stronger. Also the 100 SMA could continue to hold as dynamic resistance in the event that ETHXBT makes a quick bounce.
RSI is pointing down to show that sellers have taken control. Stochastic also appears to be heading south but is currently on middle ground, barely offering any strong directional clues. If bears aren’t quite ready to push lower yet, price could still pull up to the 0.02000 resistance. A break past this area could mark the start of a reversal.
Trading activity in cryptocurrencies has been more subdued these days compared to the weeks leading up to the EU referendum. At that time, a larger amount of uncertainty was present in the financial markets, leading traders to pursue alternative investments such as bitcoin and ethereum.
Although bitcoin network congestion weighed on the virtual currency then, the fact that it is offered in more markets compared to ethereum was one of the factors that shored up demand. Meanwhile, traders appear to be booking profits off their ETHXBT trades also, which explains the decline in price.
Moving forward, there are still plenty of uncertainties in the financial markets that might keep cryptocurrencies propped up. Officials have yet to iron out the details of the Brexit and several central banks are scheduled to make their policy announcements over the next couple of weeks. Significant shifts in biases or preference for intervention could once again lift the appeal of virtual currencies.