Ethereum investors are in control as we start the new week. ETH has come to the fore with Elon Musk’s tweet and the Fed’s concerns about crypto assets.
ETH, the second largest cryptocurrency, was at risk by breaking the ascending channel on the 12-hour chart.
The most common trading crypto assets over the weekend are starting a new week on Sunday, extending last week’s sluggish momentum.
Tesla founder Elon Musk warned against Bitcoin and Ethereum on Twitter. Elon Musk’s assertion that transaction rates are “slow” and costs are “high” added to the pressure on Ethereum, the second largest cryptocurrency.
Meanwhile, the US Federal Reserve (Fed) marked digital assets for the first time in its semi-annual Congressional Monetary Policy Report released Friday.
The Fed said in the report:
The rise in the prices of various crypto assets also reflects the increasing risk appetite of investors.
The FED report came with the price of Bitcoin rising 250% from a year ago, despite being well below its April high.
At the time of writing, ETH/USD is down 1% on the day and is trading at $2100. Ethereum is down about 10% over the past seven days.
Ethereum (ETH) price analysis
ETH/USD: Risks remain to the downside due to the rejection on the 50-day Simple Moving Average (SMA).
According to the 12-hour chart of Ethereum, the price settled as low as the ascending trendline support at $2091. The close of a candlestick below the ETH support level could end the three-week uptrend and indicate the start of a downtrend.
ETH price is trading below its Simple Moving Averages (SMA) in certain timeframes and the Relative Strength Index (RSI) is below the middle line, indicating the downside.
If there is a channel collapse for ETH, it could slide as low as the psychological $2000 level. A sustained break in the price may lead to sharp selling towards the 1720 and 1730 dollars region, which is the low of 26 June.
Figure 1. Ethereum 12-hour price analysis
Alternatively, if the 50-day Simple Moving Average hits $2120, it could aim ETH bulls’ recovery towards the $2194 level. ETH could once again challenge the $2500 psychological barrier as a higher price level.
As a result, the path of least resistance for Ethereum price looks down.