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From May 2018, the price of Ethereum (ETH-USD) has been tumbling which has resulted in it falling from $ 842 to $ 168. However, in this article, I will look at the probability of a price rise, as I am bullish on the cryptocurrency. Thus, to ascertain the likelihood of this occurring, I shall look into the fundamental news affecting the cryptocurrency while also analyzing the charts using the technical analysis tools.
Fundamental news:
The Austrian government and Ethereum:
The Austrian government announced that they will be auctioning off government bonds worth $ 1.35 billion using Ethereum. This live auction will be undertaken by the Austrian bank. Oesterreichische Kontrollbank and shall commence on October 2na. Offer of benefits through security and lower costs. I believe I will be able to raise the level of confidence offered by blockchain technology. Moreover, this shall also bolster Austria's good standing in the market.
Google'S ban on Cryptocurrency advertising:
Google next month will be recommencing cryptocurrency-related advertising. This is after it had banned such ads in March 2018. The facelift of this ban will allow the cryptocurrency to be exchanged to build their advertisement through Google's platform in Japan and the United States. It is currently unclear why Google is lifting the ban, but it looks like it is planning to cash in on the skyrocketing cryptocurrency hype. Moreover, this is a follow up on the decision made by Facebook. This news is extremely positive for the whole cryptocurrency market.
Cryptographic Quorum project:
JPMorgan's Cryptographic as a platform for the development of their financial business. This is extremely important and positive news for Ethereum. I say that, two to the Quorum network being an enterprise-focused version of the original Ethereum network. Thus, this shall provide a boost of confidence for Ethereum, as the technology and use of JPMorgan.
New Mining pools:
Ethereum shall be a boost to BTC.com adding an Ethereum mining pool to its offering. BTC.com is doing this so that they can diversify their mining portfolio, which is heavily reliant on Bitcoin mining. This is as BTC.com produced 21% of the newly mined bitcoin last year. Additionally, this shall steeply increase the hash rate of Ethereum to 12% in the next twelve months. This change will result in a significant increase in Ethereum.
Moreover, BTC.com is offering miners an Ethereum API and block explorer. This is to allow the miners to switch their hash power from one pool to another contingent upon the market conditions. It has been this year from $ 1,311 to $ 168.
Technical analysis:
Daily chart:
The cryptocurrency's daily chart indicates that it will be a bullish reversal, which will result in its value rising in the coming days. I expect this to be an internal day candle pattern. This pattern tells the story of the bulls. However, we may have two to three days of movement before a strong bullish rally can commence. Moreover, the internal day candle pattern attained a further bullish confirmation two to it between 78.6% and 100% fibonacci support levels. The 78.6% support level is $ 222.75, while, the 100% support level is at $ 215.06.
On the target price front, I expect Ethereum to rise up to 78.6% resistance level at $ 254.26. Moreover, this resistance level is also a former candle resistance zone. However, if it does this level, then the next resistance resistance is 100% level at $ 267.76.
Weekly chart:
Ethereum's weekly chart indicates that the bearish run has stalled. 78% fibonacci support level at $ 198.43 This occurred two to Ethereum taking support from the fibonacci. Moreover, the pair has been having smaller size candles in a sideways pattern that clearly indicates a bullish rally is around the corner.
Furthermore, the RSI of the weekly chart has also been in favor of the bulls as it has commenced a slight ascent. This clearly supports the 100% fibonacci resistance level at $ 267.76.
The Big Picture:
In conclusion, I am leaning towards the driver's seat as the result above. This notion of mine is fueled by the fact that the technicals and fundamentals support an ascent. However, whichever way you decide to trade, you will use trailing stops, as this will be in capital preservation which is of prime importance.
Good luck trading.
disclosure: I / we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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