Ethereum Classic is the original Ether-token that voted to remain unchanged even after a massive hack in 2016. However, another set of people who chose to move ahead with new ideologies violating the pact of Code is Law, and the newer cryptocurrency is now known as Ethereum.
Coming down to the price action so far in 2021, Ethereum Classic (ETC) is still among the top 21 cryptocurrencies with a market cap of USD 8 billion compared to USD 371 billion of ETH. Currently, Ethereum is up by more than 1100% compared to the January 01, 2021 levels of $5.8.
All these speak about the higher traction and investor’s belief in ETC. However, leaving aside the market cap and price momentum in 2021, the momentum on Ethereum Classic will be based on the technical analysis. One thing is clear that ETC is not yet in a green zone as per technical analysis, but the fundamentals are far better.
The price of Ethereum Classic cannot move up because of technical charts and failure to close above its immediate resistance levels. The interdependence of other cryptos on Bitcoin’s trend and the creation of large short volumes have been weighing heavily on the buying sentiment. But since such volumes are decreasing, anything can happen on the Ethereum Classic network. Let’s analyze the technical charts and indicators.
ETC Signals Potential Downtrend
Ethereum Classic forms a flat bottom pattern with good clarity. This pattern is closely associated with an upcoming downtrend induced by profit booking. While buyers wait for more buying at support lines, holders expect the price to reach higher, but failure to make higher highs forces holders book their profits and wait for better clarity, often leading to a fall in valuation.
Ethereum Classic is on a downtrend after failing to close above its $75 resistance level. The resulting price action has retested the support level and bounced back only retest the support levels.
This trend indicates a higher possibility of upcoming profit booking. ETC has support at $57.84 levels, followed by strong support at the 200 days moving average of $44. Hence any buying or holding at current levels carries an uncertain profit over a 27% fall.
RSI on daily charts has fallen from the overbought zones to neutral zones with a consistent decrease in volumes.
