Here's why you should be buying the Ethereum Classic price dips until...

• Ethereum Classic price is currently hovering around a stable support level at $32.62.
• Although unlikely, a breakdown of this level could trigger a buying opportunity for ETC up to $32.62.
• A weekly candlestick close below $25.11 will invalidate the bullish thesis.

Ethereum Classic has seen a massive surge over the last few weeks. This impressive rally, as explained in a previous article, is due to Ethereum’s scheduled migration from Proof-of-Work (PoW) to Proof-of-Stake (PoS). The miners’ hashrate is going into other PoW coins like ETC. As a result, the demand is also increasing for the underlying asset. 

This article, however, takes the bullish thesis on Ethereum Classic a step further, exploring the possibility of capital inflow from institutions.

Ethereum Classic: Forecasting potential narratives

While PoS is environmentally friendly, miners will not part from their golden chicken and are likely going to put their hash rate toward a PoW chain, causing a split in the Ethereum beacon chain and multiple ETH forks.

Additionally, the value of the ETH main chain will be split into two competing forks. Hence, from an investment perspective, it is better to invest in both PoW and PoS blockchains.

As a retail investor, trying to pinpoint the next Ethereum PoW chain that institutions will invest in would provide the most reward with moderate risk. The only viable alternative, in relative terms, that is close to Ethereum is the Ethereum Classic blockchain.

To add credence to this theory, there is Grayscale, an institutional-grade digital asset investment company that not only has an ETC product but is approved and free from regulatory oversight and problems.

Hence one can assume that after having a vested interest in Ethereum, the next blockchain that big money will focus on is a proof-of-work blockchain that has the capabilities of ETH. 

To sum up this narrative, we have Vitalik Buterin, the creator of the ETH blockchain, endorse the ETC blockchain by saying that ETC is a “fine” PoW chain during the recent ETH conference in Paris.

Will the ETC price dip more?

Ethereum Classic price set a range, extending from $12.51 to $52.72 as it crashed 76% between March and June 2022. This downswing was followed by a quick reversal and a rally that pushed ETC up to graze the 79% retracement level at $44.28.

After setting a swing high at $45.42, Ethereum Classic price retraced roughly 30% and tagged the range’s midpoint at $32.62. Based on the thesis explained above, this was a good dip to buy as ETC has bounced 11% so far.

Going forward, there could be more dips that could push Ethereum Classic price below the midpoint at $32.62 and allow for a retest of the $25.11 support level. These are bullish retracements and are likely going to fetch massive returns at least until September 19, when the Ethereum Merge is scheduled to take place.

In such a case, investors can expect a continuation of this explosive yet exponential move to push Ethereum Classic price to retest the range high at $52.72 again and, in a highly bullish case, $77.33.

ETC/USDT 1-week chart

While the bullish outlook is driven solely by the narrative, it could easily be undone if Bitcoin price crashes massively. In such a case, a weekly candlestick close below $25.11 will invalidate the bullish thesis.

Furthermore, the uncertainty in the traditional markets combined with the threat of a recession and war could also be one of the driving factors that could dampen this bullish outlook.

 

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