ETHER FIGHTS HARD TO STAY ABOVE $4000
Last Friday, Ethereum posted the largest red candle (-11%) in the daily chart in eleven weeks by declining from its intraday high of $4,551 all the way down to an intraday low at $3,913 which was the lowest price since the 28th of October.
The drastic depreciation in its price was, at least temporarily, stopped by the numerous buy orders placed below the $4k mark once again after a similar situation previously happened on the 18th of this month and in three further instances during October, when Ether (ETH/USDT) was still in an uptrend and trading inside of an ascending parallel channel which lasted for eight weeks since mid-September.
The $4,000 level has proved to be $ETH’s most pivotal one, so current stockholders in the asset will be hoping that it can finally start moving to the upside soon, but the coin is just not showing a lot of strength at the moment and presently is trading at $4,012. Over the weekend, on Saturday, the token faced rejection by the 50-day Simple Moving Average, which was lost during the Black Friday Sale, pointing to a strong short-term downtrend.
The trading volumes on Down days have been greater than volumes on Up days for three weeks now, which clearly indicates that the Bears are in control of the price this month after mostly staying in hibernation in October allowing the Bulls to push up Ether’s price by an incredible +43%. So far, November has seen ETH lose 6% in value (current market capitalization at $478B with dominance at 18.7% compared to Bitcoin’s dominance at 39.9%).
The second largest cryptocurrency has been in a strong uptrend in relation to the King of the market since bottoming out at 0.059 BTC on the 19th of October, although last Friday this ratio momentarily reached as high as 0.077 BTC, which actually was the highest reading for nearly three months, before getting rejected and falling back below a crucial 0.075 level.
A correction in this chart is pretty likely, in our opinion, especially when we consider the fact that Bitcoin’s (BTC/USD) domination below 40% is often seen by traders and "hodlers” alike as a decent opportunity to convert some of their altcoins back to BTC, even more so in fairly uncertain times like these, when we could reasonably expect to see even more blood in the markets due to political events taking place next week.
It’s always good to remember that whenever the retail stockholders panic, they tend to convert their digital assets back to either fiat currencies, stablecoins, or BTC.
FIRST MILLION OF ETHERS BURNED AND OTHER NEWS
Now, before moving on, let’s briefly revisit the Ethereum token burning rates because that provides us with a lot of information on both the supply, and the network activity at the same time so it’s well worthy of our attention.
A few days ago, the Ethereum Network reached a milestone of 1 million coins removed from circulation for good, which is admittedly an impressive result in itself. Since EIP-1559 got implemented on the 5th of August, ETH’s inflation has decreased by 67.5% and in the recent 30 days by nearly 93%. The total value of all Ethers that have been burned so far is, at current prices at close to whooping $6.3 billion. That will, without a doubt, serve as a long-term catalyst for the value of the asset.
What could, on the other hand, negatively impact not only ETH but generally the cryptocurrency market as a whole, is a potential crypto legislation in India, which we briefly signalled in the previous week’s article on Ethereum as an emerging red flag.
Essentially, the Indian government allegedly wants to ban all private crypto (some worryingly vague language right here) in order to pave the way for their upcoming CBDC, which is short for Central Bank Digital Currency. Thus far, it is not clear what exactly they want to ban, whether it’s all crypto privately owned by citizens, or just the privacy digital assets such as Monero, Zcash and other ones in this category. We will find our very soon, as early as the 29th of November. As if the recurring China FUD wasn’t enough, right?
Another important date when crypto investors might expect some increased volatility in the markets is the 2nd of December with the U.S. SEC hosting a panel titled “Helping to Ensure Market Integrity in the Face of New Technologies”.
As we already know, whenever politicians start talking about protecting us investors, we should be fairly certain that they usually want to take a portion of our freedoms away. Hopefully the “Indian FUD” and the SEC panel will both turn out to be only big “Nothing Burgers” and the cryptocurrencies are left alone so that Ethereum can bounce off its support at the $4k level and reignite its movement to the upside.
Stay tuned to cryptodaily.co.uk as next time we will investigate what the ETH whales have been up to, that should reveal to us a lot about the state and perspectives of this ongoing bull market.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.