Ethereum previously consolidated inside a symmetrical triangle pattern to pause from its selloff but eventually broke to the downside to signal that further losses are likely. The 100 SMA is also making a bearish crossover to indicate that selling pressure is about to pick up.
However, RSI is pulling out of the oversold region to signal a quick return in bullish pressure. This might lead to a retest of the broken triangle bottom around the 115.00 area before more bearish action is seen. This broken support lines up with the moving averages dynamic inflection points to add to its strength as a ceiling.
Stochastic is also pulling out of the oversold region to signal that sellers need to take a break and allow buyers to take over. If buying pressure persists, ethereum could still find its way back inside the triangle or even resume the rebound.
However, sentiment in the cryptocurrency industry is not looking all that positive as the recent wave is leading more traders to join in the FUD. All that coverage on the recent price declines by mainstream media has also contributed to selling pressure as more and more folks unwind their holdings.
Last week, there was a brief improvement in sentiment as the focus returned to institutional investments. Still, it looks like buyers needed more than just mere expectations to sustain gains and would rather see actual industry developments.
It also doesn’t help that SEC Chairperson Clayton said that the lack of consumer protection measures in the crypto market suggests that they won’t be approving bitcoin ETFs anytime soon. This puts the industry a step back as it means that the likes of ethereum and its peers would have to wait much longer as well. Besides, ethereum is also under additional downside pressure as it was overtaken by Ripple and might also face stiff competition from rival altcoins.