For a trading month on the Ethereum market (and that is how much has passed since the publication of our previous article), the situation has changed drastically. Globally, buyers failed to accelerate the growth trend and go beyond the trend channel. Buyers managed to stop the panic fall wave in the crypto market only in the range of $2050-2150. And even this range for some time, sellers managed to break down (19 and 23 May):
The main support of buyers is in the range of $2050-2150
History shows that from February 2020, the $2050-2150 range has proven to be liquidity. All powerful medium-term price movements reversed from this liquidity zone. At the moment, the range of $2050-2150 is the lower limit of the consolidation. The upper limit of consolidation, where the Ethereum price has been moving for a month, is in the range of $2900-2990. Trading volumes have been systematically decreasing since the end of May. This fact makes us understand that a new impulse price movement will begin soon. Considering that our main scenario for the BTC market is continued growth to $46000-48000 , we expect a local upward wave from the ETHUSDT market. While the range of $2050-2150 is under the control of buyers, this scenario will be the main one for us.
In May ETH candle closes with hint of long consolidation
If you look at the monthly timeframe, you get the impression that the consolidation at historical highs will drag on for several months:
Note that the May candle closed on high volumes and finally showed the presence of large sellers. However, the close of the May candle also showed that buyers are willing to buy back Ethereum at high prices for at least some more time. Therefore, an attempt to test $3300-3600 may be the last ray of positive in the Ethereum market before a new fall wave forms.
Analyzing the ETHBTC chart, we see that the price is now above the critical range of 0.06-0.062:
As we can see in the chart, the ETHBTC price is moving in the local correction channel. The price fall happens at low volumes, and with a high probability, after the test of 0.06-0.062, a new growth wave will begin. The worst-case scenario at the moment is a breakout of the range of 0.06-0.062 and a fall by another 15-20%. Though, this is a negative scenario, which is an alternative for us. Why? It is also worth looking at the monthly candle on the ETHBTC chart:
As we see, it was the sharp BTC price fall that negatively affected the Ethereum price. During the fall, investors bought ETH for bitcoins to mitigate losses. Since the BTC dominance has now begun to grow – some investors began to fix profits in the ETHBTC pair and expect the continued growth of the BTC price.
Considering the above, we expect another growth wave in the BTC market, after which other coins may repeat its success. After this growth wave, we will exit the market and observe the balance of power. Globally, we expect another fall wave, which may be stronger than the May one.