- Ethereum posted an intense breakout rally yesterday that allowed it to set fresh local highs
- This rally came about rather suddenly, with it coming about prior to any movement seen by Bitcoin or the aggregated crypto market
- Analysts are now noting that this uptrend may start to falter in the days ahead, as it is currently repeating a pattern that is strikingly similar to that seen in months past
- This potential weakness comes as Ethereum’s options see rocketing volume, signaling that ETH is likely to see heightened volatility
Ethereum’s recent uptrend allowed it to post massive gains, climbing from the lower-$200 region to highs of $250.
Il cryptocurrency’s momentum has stalled a bit as of late, which could be a sign that buyers overextended themselves throughout the course of this latest movement.
It now appears that this upswing came about after ETH formed a similar technical pattern to that seen prior to its rallies in months past.
All of these rallies were fleeting and followed by sharp retraces, and if history repeats itself, ETH could soon find itself caught within another downtrend.
Ethereum’s Rally Stalls as Analysts Eye Potential Downside
At the time of writing, Ethereum is trading up marginally at its current price of $235. This marks a notable retrace from daily highs of roughly $245 that were set at the peak of this latest upswing.
This movement first began last Thursday when ETH bounced from lows of $210 to $225. After hitting this level, the crypto ranged sideways for a day before incurring immense upwards momentum that led it to its recent highs.
The technical formation that drove this movement was the same one that triggered the other rallies it has seen throughout 2020.
One popular crypto analyst pointed this out in un recente tweet, offering a chart showing that striking similarities between this uptrend and the ones seen in February and April.
“ETH this time was not different… Up 15%+ after breakout & retest,” he said while pointing to the chart seen below.
Immagine gentilmente concessa da Luke Martin
If Ethereum replicates its previous price action, it could see a bout of sideways trading before declining lower.
ETH Options Volume Rockets, Signaling Volatility is Imminent
Another factor that could influence Ethereum’s Prezzo azione is rocketing options volume.
Secondo dati from research platform Skew, ETH options volume rose by $20 million on Deribit yesterday.
“New record for ether options volume on Deribit: $20mln notional traded yesterday,” they noted while pointing to the chart seen below.
Dati tramite inclinazione
Heightened options volume suggests that the criptovaluta is likely to see further intense volatility in the days and weeks ahead, and the aforementioned pattern suggests that this volatility will be to the downside.
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