- Ethereum initially tried to rally during the trading session on Friday but has given back the gains as we continue to just hang around the 200 day EMA.
- The 200 day EMA is a significant long-term technical signal.
- Now it looks like the 50 day EMA is doing everything it can to try to cross above it, kicking off the so-called golden cross.
The market has been consolidating for a couple of months here and the $2,400 level looks very much like a floor. The $2,800 level above is a bit of a resistance barrier. And I think that’s where we are stuck. If we were to break down below $2,325, it’s possible that we could drop to the $2,000 level eventually.
Noise Will Continue
This is a market that I think continues to be very noisy. I think it also continues to follow Bitcoin as it did on Friday. Bitcoin initially rallied as well but also gave back gains. This is a little bit of a risk asset. So, we have to pay close attention to the possibility of external things coming into the picture and causing chaos as well. There are wars, central banks, and potential trade wars that could come into the picture to cause a lot of risk appetite to evaporate.
For example, if the war really picks up in the Middle East, traders probably don’t want to hold crypto. You’ll probably see a knee jerk explosion to the downside. However, that could very well be a nice buying opportunity. As things stand right now, we’re just killing time here, working off some of that massive froth that we got into the market. And now all eyes are on the $2,800 barrier, which so far has been a bit much for the market to take out.
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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.
