KEY POINTS
- Ethereum has been stuck below $400 even though Bitcoin has already reached $14,000
- A downward trend could put Ethereum back to $382
- Analysts said Bitcoin’s price increase is sucking out all the volume, leaving Ethereum with high selling pressure
Analysts are predicting further downsides if Ethereum fails to clear the $400 resistance in the coming days.
After reaching as high as $420 on Oct. 22, Ethereum failed to sustain this momentum and went on a downward trend, reaching as low as $373 on Oct. 30. While Bitcoin made a historic breach of $14,000 on Saturday, Ethereum did not even reach $400 on the day.
Still, for the past two days, Ethereum is in an uptrend and at the time this article was written, the second-largest cryptocurrency was trading at $398.
The key resistance that Ethereum broke to reach this level was found in $395. Ethereum must sustain a break above it if it has to break past $400 in the next few days. The key resistance remains further ahead at $420, NewsBTC reported.
Should Ethereum get stuck below $400, a downtrend could put it back to the $382 level. If it breaks, the major support can be found at $373. Any further downtrend must stop at $365 or else major losses for Ethereum will be underway.
Ethereum has been heavily correlated with Bitcoin. So far, however, Bitcoin has just reached a major price milestone while Ethereum hasn’t yet broken past $400, a level it has already visited this year.
In an op-ed, Cointelegraph’s Joseph Young said Bitcoin’s price increase is bad news for Ethereum and other cryptocurrencies because the former is sucking out all the volume. This has caused a pullback in the price of most altcoins, evidenced by increased selling pressure and low demand.
If history is to repeat, Bitcoin is usually the first to rise and after that, money starts flowing into altcoins. Young said traders are seeing the same pattern to reoccur in the current price cycle, with the expectation that altcoins will recover by 2021.
Some traders dispute this. They say it appears that currently, even when Bitcoin goes down, major altcoins go down in price as well. A trader named “CryptoCapo,” says buyers should choose wisely before entering into altcoins at this point.
“Let’s be honest: There are alts that look really bad, alts that look decent, and alts that look good. I don’t see any altcoin that looks really good right now. Choose wisely,” the trader said on Twitter.