ETH/USD is set to go into the last weekend of April near lows, and its strong selloff recently may create a speculative playground for traders looking to wager.
ETH/USD is near the 2850.00 price as of this writing. On the 3rd of April Ethereum was trading near the 3580.00 price level, a juncture ETH/USD had not touched since the first week of January. However, after hitting this mid-term high ETH/USD then produced a rather steep downward slope. In fact ETH/USD is now testing values it has not traversed since the middle of March. Ethereum remains a major cryptocurrency in the broad digital market, and its price action certainly causes reactions among its counterparts.
While some traders who remain bullish may believe the recent downturn in ETH/USD is fine and a mere overreaction, there are other speculators who are likely looking at Ethereum and wondering if mid-March support levels will falter. ETH/USD is the second biggest cryptocurrency after Bitcoin, and it remains highly speculative. The ability of Ethereum to climb within sight of 3600.00 in early April, only to fall to nearly 2760.00 on the 26th of April is a rather incredible price difference. Traders need to consider not only their risk management tactics, but their emotional fortitude to withstand price volatility.
However, most day traders of ETH/USD are not concerned with next week, they are concerned about tomorrow. In many respects the trend must be respected, because while it is easy to look for reversals, actually following the momentum of ETH/USD may be the more logical method of speculating for short term wagers. Technical traders may be looking at current support near the 2800.00 mark and believe if it falters that 2700.00 is a solid target.
If April rain does in fact bring May flowers, traders may have reasons to be optimistic and look for upside in ETH/USD, but this is not the weather we are discussing, this is the cryptocurrency landscape. While the move of Ethereum to early April highs was met by a firestorm of selling, the broad digital market also suffered a downturn too. And the long term bearish trend which has dominated the cryptocurrency landscape since November of 2021 has reemerged with a dangerous thrust. If current support levels do not hold and ETH/USD falls through mid-March support, more nervous sentiment can certainly develop.
An ominous sign for some technical traders may be the knowledge that February prices of ETH/USD were worse than March lows. A depth of nearly 2300.00 was seen on the 23rd of February. This value is far below mid-March support which is closer to 2550.00 on an averaged basis. However, if these mid-March prices are challenged, February’s lows will come plainly into view and even perhaps price targets for some traders.
ETH/USD Outlook for May:
Speculative price range for ETH/USD is 2150.00 to 3675.00.
Current support levels are dangerous and should be monitored in ETH/USD. If Ethereum fails to sustain upwards momentum and keep its price above the 3000.00 mark for a solid duration, this could cause bearish traders to believe another leg down is going to occur. The next week of trading in ETH/USD is likely going to be volatile because of the nervous sentiment being generated with risk assets globally, such as the NASDAQ 100 stock index. While it may seem farfetched to mention this potential correlation, a look at long term charts of Ethereum and the NASDAQ 100 are worth a glance to gain a perspective regarding behavioral sentiment.
If ETH/USD should fall below the 2700.00 mark this could spark more selling. Short term traders should not be overly ambitious and use take profit orders, so they do not suffer from the potential of wicked reversals creating havoc with profits that are not cashed in and are simply made to vanish. If negative sentiment continues in the broad crypto market, ETH/USD could certainly test lower depths.
Bullish traders are still within the cryptocurrency sphere for a good reason, they understand reversals higher often occur after wild selloffs to the downside. However, short term buyers should be extremely cautious. The trend lower is not a joke. Momentum upwards should be waited on by more conservative traders before attempting wagers. Perhaps a move above the 3100.00 mark could signal a solid change in direction. Some traders may believe only a move above 3400.00 can be viewed as positive idea for future trend.