Ethereum has declined more than most projects this year as price depreciated from above $1400 in January to a 2018 low of around $173. Over the past month, the price has started to appreciate and form higher highs and higher lows. Ethereum is currently trading around $225, but it has started closely following the price action of the market leader Bitcoin over the past 1-2 weeks.
While many have been anticipating breakout in Bitcoin it has continued to consolidate with volatility as 2018 lows. The RSI of Bitcoin has also been converging around 50 showing equal pressure from buyers and sellers. The same has started to occur in Ethereum with price forming higher lows but also forming lower highs. The RSI has also been converging close to 50 showing equal pressure from buyers and sellers.
With Ethereum being the largest altcoin by market cap, it has a significant impact on the overall performance of the altcoin market. However, it has started to closely follow the market leader Bitcoin which represents over 52% of the total cryptocurrency market cap. The consolidation Ethereum is experiencing is only likely to break out in whatever way Bitcoin’s consolidation breaks out in.
If Bitcoin continues to trade tightly on low volume, it is very likely Ethereum will do the same. The volume in Ethereum trading has been minuscule and far below the 20-period average daily volume. An exception to this would be the announcement of a key technological development in the Ethereum project.
- Ethereum has been mirroring the price action of Bitcoin recently with consolidating price and low volume.
- RSI is trading around 50 and converging showing equal pressure from buyers and sellers.
- Price is likely to break out in whatever way Bitcoin breaks out in provided there is no key announcement of a technological development in Ethereum.