Ethereum has seen some intense selling pressure for the past day, which has caused a blow to the technical strength brought on by yesterday’s buying pressure.
This drop has left it increasingly unclear as to where the crypto could develop in the short term, but it appears it could be positioned to see significant further downward movement in the short term.
Speaking of this recent drop, one analyst noted that it appears to have been fueled by a so-called “whale” that had previously raised the price of the cryptocurrency by falsifying buy orders.
The analyst notes that this whale “pulled the carpet” on ETH, leading to today’s downturn. As such, it may continue to see increased weakness in the near term as it has now broken below a significant support level.
Unless this level is recaptured, chances are the cryptocurrency will continue to decline lower in the short term.
Ethereum is seeing a sharp drop as the market weakness intensifies
At the time of writing, Ethereum is trading more than 8% down at its current price of $ 357, marking a notable decline from the daily highs of $ 390 reached at the peak of the uptrend yesterday.
This rebound came in conjunction with BTC’s push to its highest price of $ 10,600, which is roughly the price for which it found significant selling pressure that slowed its rise.
Analysts now note that the short term directionality of the entire market may largely depend on BTC’s response to USD 10,200, where it has gained strong support in recent weeks.
If the benchmark cryptocurrency breaks below this level, it could create tailwinds that further weaken Ethereum’s recent strength.
ETH Whale unwinds the uptrend following spoof orders
While talking about Ethereum’s recent uptrend, one analyst says noticed that it was primarily powered by bogus orders from a single whale on Bitfinex.
That said, his removal from these bids may have triggered today’s downtrend. It also helped move the cryptocurrency below a significant level of support within the USD 360 region that was previously strong support.
“ETH update: Well done Mr. Walvisman. Did it say from the beginning of this meeting that it was landed by a whale. And there is the rug. By some of my previous analysis it should bounce around here, but I’m not inclined to jump in just yet, too much dump too soon. “
Image Courtesy of Chase_NL. Chart via TradingView.
How Ethereum trends in the coming days will largely depend on the continued response to the support it finds at USD 350, and whether it can reclaim USD 360 in the near term.
Featured image from Unsplash. Charts from TradingView.