Ether price analysis 29 Nov: have you missed the chance to buy?

Ether’s relief rally could face selling at higher levels

A conceptualisation of ethereum 2.0 against a background of outer space                                 
Etherereum's star is rising – could it one day supplant the crypto king? Photo: Shutterstock
                                

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

Ether weekly chart
Ether price technical analysis: weekly chart – Credit: Currency.com

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

Ether daily chart
Ether price technical analysis: daily chart – Credit: Currency.com

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.

Before investing in any asset, always do your own research or contact your financial adviser before arriving at a decision. Remember that your decision should be based on your attitude to risk, your expertise in this market, the spread of your portfolio and how comfortable you feel about losing money. Never invest more than you can afford to lose and keep in mind that past performance is no guarantee of future returns.

The material provided on this website is for information purposes only and should not be regarded as investment research or investment advice. Any opinion that may be provided on this page is a subjective point of view of the author and does not constitute a recommendation by Currency Com Bel LLC or its partners. We do not make any endorsements or warranty on the accuracy or completeness of the information that is provided on this page. By relying on the information on this page, you acknowledge that you are acting knowingly and independently and that you accept all the risks involved.

Ethereum to US Dollar
Daily change
3277.64
Low: 3244.66
High: 3361.03

Further reading

The material provided on this website is for information purposes only and should not be regarded as investment research or investment advice. Any opinion that may be provided on this page is a subjective point of view of the author and does not constitute a recommendation by Currency Com Bel LLC or its partners. We do not make any endorsements or warranty on the accuracy or completeness of the information that is provided on this page. By relying on the information on this page, you acknowledge that you are acting knowingly and independently and that you accept all the risks involved.
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