Ether price analysis 29 Nov: have you missed the chance to buy?
Ether’s relief rally could face selling at higher levels
Ethereum’s ether token has bounced off the psychologically important level of $4,000, indicating accumulation at lower levels. A recent CryptoCompare report showed that ether’s assets under management (AUM) rose 5.4% to $16.6bn even as bitcoin’s AUM dropped 9.5% to $48.7bn in November.
According to the current ether burn rate, ultrasound money anticipates 4 million ether to be burned every year. The current ether issuance is about 5.4 million ether per year, which is expected to reduce when the Ethereum 2.0 upgrade happens next year.
Ultrasound money expects ether’s supply to peak roughly at 119.7 million ether and then start to decrease after the Ethereum blockchain transitions from proof-of-work consensus to proof-of-stake.
Meanwhile, in a new blog post, Ethereum co-founder Vitalik Buterin has proposed to “decrease transaction call data gas cost, and add a limit of how much total transaction call data can be in a block”.
Could ether go up and pull altcoins higher? Read the ETH price analysis to find out.
Ether price technical analysis: weekly chart
ETH’s price formed a Doji candlestick pattern last week, indicating indecision among the bulls and the bears. The ETH/USD pair finished last week at $4,299.03, with a marginal gain of 0.88% over the previous week’s close.
The moving averages are sloping up and the relative strength index (RSI) is in positive territory, indicating the path of least resistance is to the upside.
If bulls drive the price above the previous week’s high of $4,557.10, the positive momentum could pick up and the pair may retest the all-time high at $4,868.91. A break and close above this level will signal the resumption of the uptrend. The next target objective on the upside is $6,130.24.
Contrary to this assumption, if the price turns down from the current level and breaks below the previous week’s low of $3,912.37, the bears will fancy their chances. They will then attempt to sink and sustain the pair below the 20-week exponential moving average (EMA).
If they succeed, the selling could accelerate and the pair may drop to the next major support of $3,000.
Ether price technical analysis: daily chart
ETH’s price dipped below the psychological support of $4,000 on 26 and 28 November but the bears could not capitalise on this advantage. This indicates strong buying at lower levels.
The bulls will now try to push and sustain the price above the downtrend line. If they manage to do that, it will suggest the correction may be over. The pair could then attempt a rally toward the all-time high.
Alternatively, if the price turns down from the downtrend line, it will suggest that traders are booking profits on rallies. The bears will then try to deepen the correction and pull the price below the 100-day simple moving average (SMA). Such a move could open the doors for a decline to $3,370.
The flattish 20-day EMA and the RSI near the midpoint do not give a clear advantage either to the bulls or the bears.
Ether: Buy or sell this week?
Ether’s price analysis shows that traders are buying on dips below the $4,000 level. A break and close above the downtrend line could signal that bears may be losing their grip. The sellers will have to sink and sustain the price below the 100-day SMA to gain control.
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