- Accumulating Ethereum Classic (ETC-USD) for the long-term is a good idea for investors.
- The “cryptocurrency is fake” argument is baseless.
- Traders also have opportunities for short-term gains.
Source: Shutterstock
The price of Ethereum Classic (ETC-USD) struggled to hold above $50 last week. The main reason for this is the normal resistance that came about last year. The recent rallies in it and Ethereum (ETH-USD) were strong, so it is acceptable for them to rest. The struggle at these levels should not be reason to give up on ETC. Traders and investors can still have it on their menu of viable crypto coins to buy.
ETH fell 20%, but so far the bulls are buying the dip. Late January I wrote about the Ethereum opportunity and it delivered 40% profits for traders and twice. I decided to hold my ETH coins since then, and staked them for more potential returns.
Meanwhile, Ethereum classic did even better since the January lows. From the deepest point to the highs it delivered 150%. They now have time to tackle the natural zone of resistance from last year. So far the evidence points that there should be support below. Therefore, the bulls have help if they need it. Then the opportunity now is for traders to buy dips. The bigger short-term reward will come from the potential breakout above $54.5. On the other hand, investors should continue to accumulate small pieces overtime. While it is not currently a coin I own, I would add it to my crypto shopping cart.
| Ticker | Cryptocurrency | Current Price |
| ETC-USD | Ethereum Classic | $45.94 |
Meanwhile, most traditional equity investors are still not over the skepticism of the whole concept. They are still in the denial phase, so before we discuss opportunities we should start by justifying the whole sector. The majority of the naysayers don’t believe in crypto, because they heard smart people say it’s fake.
But they do exist and some cost fortunes. More importantly, they have held value better than stocks, and recover from corrections quickly and in bigger leaps. The world already transacts in many synthetic assets (consider art for example). Eventually the world will adopt these coins too.
Bitcoin (BTC-USD) remains the chief coin in charge that all crypto follow. So if BTC-USD rallies, then most of the other coins will follow in kind. The next important milestone is for BTC to regain $46,000 and soon. This is so that the bulls can re-establish their footing for sustainable rallies. Otherwise, it is at-risk of retesting the last bounce at $33,000. Ethereum Classic, like most coins, will follow BTC in stride.
Ethereum Classic Has a Strong Pedigree
Source: Charts by TradingView
ETC-USD is what Ethereum was before the hard fork. So it still has ties to the dominant crypto network. The majority of transactions in crypto now occur on the Ethereum network. The fork occurred to make whole investors who lost money from the DAO hack. The two charts don’t quite match up perfectly but they are still both viable.
Purists will continue to favor the Ethereum Classic, which will piggy back off its strong cousin. Part of today’s discussion is to share levels to help profit from the near-term price action in ETC-USD. If it loses its recent footing at $42.5, it could drop 20% from there. That would be a healthy pull-back to regain better momentum. There’s evidence of support below, so they should have a base from which to spring. The upside can be substantial, but with plenty of resistance areas. There will be sellers near $64, but above that the target can extend all the way to $80.
From a slightly longer-term perspective, Ethereum classic is in the hands of the sellers. The chart is in a descending slope since last May. The good news is that it has established a bottom, so the battle is between that and the lower-high trend. The two trends will soon face off sometime this quarter. If the bulls are able to rise above $55, ETC could rally 40% from there.
The job of Ethereum Classic investors is a bit easier than the traders. Buying large dips has been a winning strategy for a while. Nibbling in small bites along the way would also make sense. For that purpose, I currently hold Solana (SOL-USD) and Ethereum. I bought both at the very low of the dip earlier this year. I have booked enough short-term profits, but I intend to retain an ongoing core position. This is the same thing I did with gold for decades.
On the date of publication, Nicolas Chahine held Solana, Ethereum and USDC. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.