Ethereum Classic price eyes 30% crash as Merge-induced hype disappears
|- Ethereum Classic price is in a downtrend, looking to produce a lower high before triggering another 30% crash.
- The resistance area, extending from $35.14 to $36.49, is a potential zone to form the lower high for trend reversal.
- A daily candlestick close above $39.56 will create a higher high and invalidate the bearish thesis for ETC.
Ethereum Classic price shows a clear, persistent downtrend with distinctive lower highs and lower lows. The ongoing upward move will probably form a lower high and trigger another sell-off.
Ethereum Classic price prepares for next leg
Ethereum Classic price has dropped roughly 33% between August 13 and August 29, creating a string of lower lows and lower highs. The latest swing low formed at $30.32, and the ongoing upswing is likely to continue the pattern and create another lower high.
$35.14 to $36.49 is the next area where Ethereum Classic price could form a lower high. Therefore, investors can expect ETC to move up by another 5% to 7% over this week before positioning for a resumption of the downtrend. Looking for weakness in the aforementioned resistance area is likely to bode well for investors that are looking to short ETC.
The resulting downswing could knock Ethereum Classic price down by as much as 25% to the first support level at $26.27. However, the move could even extend to the next resistance level at $25.11.
Instead of reversing in the mentioned area, there is a chance Ethereum Classic price could extend higher and retest $39.56. Although this development will create a higher high, the downtrend could still be intact if the sellers take control and produce a lower low in a lower time frame.
The targets remain the same in this situation, but the entry point would be a little higher.
ETC/USDT 4-hour chart
While things are looking bearish for Ethereum Classic price, a daily candlestick close above $39.56 will create a higher high, suggesting that the buyers are back.
This move should sustain above the aforementioned level; doing so will invalidate the bearish thesis for ETC and trigger a potential rally to sweep equal highs at $42.58 or $45.48.
Note:
The Merge update has caused Ethereum Classic price to rally quite a bit within a short period of time, but post-Merge, these altcoins, especially ETC might face a strong headwind and lead to unwinding of long positions or dearth of capital. For more information, check out the video attached below.
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