The first week of October was tough for Ethereum (ETH) as the price of the largest altcoin dropped from $1,765 to $1,520. This 10.7% decrease resulted in the loss of all the gains made in the previous month and pushed the price back to the critical support level of $1,500. Now, can this support level serve as a bounce level for the altcoin to start its recovery process? Let’s take a closer look.
What’s Next for Ethereum?
The price of Ethereum has increased by 0.86% in the past 24 hours, trading at $1,544 and showing a Doji candlestick formation at the $1,530 support level. This neutral candle formation following a significant drop usually indicates that the downward momentum has exhausted. Furthermore, the price of ETH is at 42,957 Turkish liras.
Currently, a rising trendline can be seen around the $1,500 level on the daily chart of ETH, providing additional support for bullish investors. This trendline is part of a larger rising wedge formation that has been guiding the price recovery of ETH for over a year.
If buyers manage to keep the price above this double support zone, a bounce towards the $1,745 level could be observed. The reversal of the downward movement within the rising wedge formation theoretically could fuel a rally towards the overall trendline, suggesting that the largest altcoin could surpass $2,200, which is the peak of its next recovery cycle.
However, the decrease in the lower band of the Bollinger Band on the daily chart reflects the strength of the bearish trend. The decreasing trend between the Moving Average Convergence Divergence (MACD) (blue) and the signal (orange) on the same time frame also reveals the tone of the aggressive decline in ETH.
ETH vs BTC Performance
Increasing selling pressure in the altcoin market pushed ETH down to $1,522, the lowest level in the past seven months. This movement indicates that sellers are currently dominant.
Interestingly, the price of Bitcoin (BTC) was more stable during the same period and only experienced a slight correction. BTC managed to stay above the recent swing support around $26,500. This divergence between ETH and BTC indicates different market sentiments for the two leading cryptocurrencies.
