Throughout the previous two weeks, the Ethereum value nearly doubled from $85 to $160 in expectation of the programmed Constantinople hard fork that is set to be performed from January 14 to 18.
The capacity of Ethereum pointed as the interchange activity of the second most valued cryptocurrency in the overall market flowed on ever major digital asset exchange.
However, huge short-term increases leave assets helpless to large short-term improvements and in the last several hours, the price of ETH let fall by 14.9 percent from $154 to $131 in one of its prime single-day drops in the past 12 months.
As sell burden on the cryptocurrency market increased and bears initiated a sell-off of digital resources, cryptocurrencies that proved decent gains throughout December and January in the likes of Ethereum, Bitcoin Cash, and Litecoin described the largest losses on the day.
As early as January 7, dealers including The Crypto Dog suggested that the technical signs of ETH suggest a short-term downward movement.
The trader said on Monday:
Maybe I’m just seeing what I want to see, but this chart is screaming to me ‘last chance to short ETH.’ It makes sense to see some bounce here, given this level on the ratio, so I hesitate to say this is a great entry. …and of course, I’m just thinking out loud, not trying to urge anyone to FOMO into a trade. I shorted ETH at $156 and sitting relatively comfy here.
Although both major crypto assets and small market cap tokens showed signs of short-term recovery in the last two months, several analysts suggested that without a breakout above key resistance levels, it is difficult to declare the establishment of a proper bottom in the cryptocurrency market.
In late December, Mark Dow, a trader who shorted Bitcoin (BTC) from its all-time high at $19,500 all the way down to $3,500, said that if Bitcoin fails to recover beyond $6,000 in the short-term, the market is in trouble.
“Still a beautiful chart. If bitcoin can’t bounce to at least $5k – $6k soon, it’s a really bad sign for the cyberbulls. And if it breaks down thru the yellow line at any point, even the HODLers need to GTFO,” Dow said at the time.
Trend Hasn’t Changed
Essentially, Dow suggested that the trend in the cryptocurrency market has not changed and crypto winter is still in full effect.
If cryptocurrencies continue to demonstrate a high level of volatility in a low price range, at least in the foreseeable future, a major trend reversal is highly unlikely.
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