- ETH/USD gained 5%, but the upside may be limited.
- The short-term technical picture implies that the selling may be resumed.
Ethereum is changing hands at $112.13 at the time of writing. The third largest digital coin has gained over 5% since this time on Tuesday, amid overall cryptocurrency market recovery. ETH/USD briefly dipped under $100, but the breakout proved to be false as the coin returned to the previous range very quickly. Ethereum’s market value is now registered at $11.5B, average daily trading volumes – $2.3B.
Meanwhile, Vtalik Buterin, the creator of Ethereum, believes that blockchain is best suited for the global payment system and cryptocurrency creation. Other use cases are either dubious or require much more time for development and adoption.
“Sometimes it’s for marketing hype. Sometimes it’s just people who are genuinely excited about blockchains and want the thing they’re personally excited about and their job to align more with each other… In some cases, I think it leads to a lot of wasted time,” he said on the sidelines of Devcon 4 in the interview with Quartz.
Ethereum’s technical picture
The local support lies with $109.45/50 area strengthened by SMA5 (4-hour) and SMA50 (1-hour). Once it is cleared, the sell-off may be extended towards the recent lows of 100.89 and to psychological $100 where a fresh buying interest is likely to appear.
On the upside, the short-term recovery is capped by $118 congestion area that stopped the bulls twice on Monday. The next hurdle is created by $120 and $122.56 (SMA200, 1-hour).
The Relative Strength Index (1-hour chart) is reversing to the downside, which means that bulls will have a hard time pushing ETH above the said resistance levels.
ETH/USD, 1-hour chart