- Ethereum has failed to break the key resistance at $370 and has stayed within $350
- Bulls were able to protect the $350 level by preventing a drop to $340
- Failure of these major supports could mean Ethereum would be visiting $310 soon
Ethereum has failed to break the key resistance at $370 and has further drop to $350. Losses due to the decreasing hype surrounding decentralized finance, as well as key technical indicators, are looking to bring Ethereum down to $310 in the short term.
Ethereum closed Sunday at $352 on Coinbase but that’s after failing to break past $370 three days prior. The failure to break is attributed to the news that derivatives exchange BitMEX was charged by both the Department of Justice (DOJ) and the Commodity Futures Trading Commission (CFTC) of failure to implement required anti-money laundering (AML) and know-your-customer (KYC) features. The drop in Bitcoin cascaded to Ethereum on Thursday, resulting in losses for the second largest cryptocurrency.
With that, the Thursday high was printed at $372, and breaking past $355, a major support zone, led to the 100 simple moving average (SMA) in the 4-hours chart to move into the negative zone, NewsBTC.com noted. On Sunday, further losses were stopped as bulls took the reins to keep the price within the $350 mark.
In the short-term, Ethereum faces multiple resistances on its move upwards. The first one is at $353, which was near the Fib retracement level when Ethereum went from $372 to $335 last week. Break that level and the price could target $370 or $380 after a few days.
Failure to sustain the $350 to $355 level could signal further downsides immediately to the $340 level, According to NewsBTC.com, the first major support is around $334. Staying above this level would prevent massive downside. However, failure of that support would mean Ethereum could point to $315 or $310, with any further failure leading finally to $300.
External factors like BitMEX and President Donald Trump getting coronavirus have affected Bitcoin, which cascaded to Ethereum and other altcoins. However, the waning hype around decentralized finance (DeFi) has also affected Ethereum, where most of these DeFi protocols are built. According to Cointelegraph, most DeFi tokens are currently oversold. This could be a mild correction, but because the total locked value in these protocols have remained very high, the publication said investors and analysts are still bullish on DeFi.