Ethereum Faces Swift Rejection At Key Resistance Level, Future Performance Will Likely Follow Bitcoin
Ethereum came close to breaching its key resistance level at $250 with the coin trading at $249 just after midnight on Wednesday, June 24.
However, Ether faced a swift rejection and was trading at $238 by 8AM the same day, Bitpush data shows. The currency has been showing strong signals over recent weeks, but these metrics have failed to manifest themselves in the coin’s price. Earlier today, addresses holding 0.1 or more of Ether reached an all-time high of 3,029,913. But this has not seemed to spur buying pressure.
As Ether approached $250 yesterday one analyst noted that the coin faced a sell wall on Binance, BitMEX, and Coinbase indicating that there is not strong HODLing sentiment among Ether owners. One analyst shared in a tweet that since 2016 seven out of nine years Ether has performed well during the first half of the year then drops down over the course of the second half.
One popular trader noted in a tweet that Ether dropping below $238 would invalidate a bullish outcome. At the time of writing Ether is trading hands at $235 and is down 3.83%.
But it may not be all bad news for Ether. Grayscale Ethereum Trust’s price dropped 50% this week as the premium sank from 725% to 350% over spot price. The high premium was thanks to a stipulation in the Trust’s contracts stating that Ether assets must not be sold within a year of the purchase. The year recently expired, causing both the premium and the Trust’s price to plummet as investors sold off their Ether to capture the premium.
The Trust’s premium and price collapse could bump up Ether’s price as investors take short positions while the supply remains the same, Avi Felman, a trader at BlockTower Capital told Cryptoslate.
Ethereum has been following Bitcoin’s trends in recent weeks, so BTC’s performance will likely influence Ether’s. If Bitcoin drops below it’s support at $9,000 it could spell trouble for both currencies.
By Emily Mason