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The Ethereum cryptocurrency, the ether, is losing altitude, with signs suggesting that the business closed a bull market from the December lows with a decline of less than $ 200 last week.
The second largest cryptocurrency by market capitalization is currently trading at $ 183 on Bitfinex, which represents a 7.3% decline on a 24-hour basis. Prices fell 10.18 percent last week and closed (Sunday, UTC) at $ 194, the first weekly close below $ 200 since mid-May.
More importantly, with the weekly closing at $ 194, the weather has breached the bullish trend since the December lows, as represented by the trend lines linking the December and February lows and the December and May highs.
In essence, the eight-month ascending channel was breached downward, a sign of a shift from a bullish to a bearish trend, according to the technical analysis theory.
Thus, the cryptocurrency could remain under pressure in the short term, especially since bitcoin, the main cryptocurrency, is looking south.
Weekly chart
Ether hit bottom at $ 83.00 in mid-December, while the bitcoin bear market ran out of $ 3,100.
The cryptocurrency then traced its first bullish low to $ 102.50 in the first week of February, before entering a bull market with a move above $ 167 in the first week of April.
In particular, prices rose by almost 57% in May – the largest monthly increase since April 2018 – extended earnings reached a ten-month high of $ 363 at the end of June.
The cryptocurrency withdrew in July, but the correction did not damage the bullish structure.
However, the last drop below $ 200 violated the minimum lows and high highs represented by the increasing channel since the December lows. Furthermore, ETH made a failed attempt to resume the rising channel at the beginning of this week, strengthening the channel break.
Downward moving averages of 5 and 10 weeks (MA) also indicate a bearish configuration.
Meanwhile, the 14-week relative strength index (RSI) fell in the bearish territory below 50 and the moving average convergence divergence crossed for the first time below zero for the first time since December, confirming a bearish reversal.
Thus, support levels aligned at $ 170 and $ 150 could come into play in the short term.
Revelation: The author does not hold cryptocurrency assets at the time of writing.
Image of Ethereum via Shutterstock; charts for Trading View
