Ethereum Classic: ETC drops to resistance $27.3, but traders may need to be cautious
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Disclaimer: The results of the following analysis are the sole opinions of the writer and should not be considered investment advice.
- Ethereum Classic has already seen rejection at the $29 mark
- $27.3 also changed to resistance, a retest could offer traders an opportunity
Ethereum Classic [ETC] has been trending down since early September. There have been significant short-term bounces in the middle, many of which measured close to 10%. However, the overall term structure remains bearish, despite the increase in the network hash rate. It stayed that way for Ethereum [ETH] as we headed into a new week.
Ethereum Classic ETC price prediction for 2022
Also, October 10 could see ETC set a range for the week, based on the high and low of the day. Meanwhile, Bitcoin [BTC] saw the Bollinger Bands (BB) prick up on the hourly price charts to show reduced volatility over the past two days.
Can ETC retest the $27.3 10% off offer?
The reduced volatility around Bitcoin could be a sign that a strong move was imminent. The sentiment in the traditional markets on October 10 would certainly influence Bitcoin as well. Therefore, traders should beware of increased volatility just around the corner.
For ETC, the price action showed that another bearish move could be in the offing. Short-term support at $27.3 had held for a week, but on the previous trading day this level was broken decisively. A retest of this zone would see sellers jumping into the fray with abandon.
The Relative Strength Index (RSI) came in well below the neutral 50 on the two-hour chart to show strong downward momentum. Stochastic RSI was rising towards the 80 mark and a bearish cross can be used to add confluence to a short-selling opportunity. The invalidation of this bearish idea would be a session close above $27.62.
ETC Funding rate cools down
In mid-September, the price crashed from $38.5 to $28.3 in the span of a week. The funding rate went crazy around this time as short positions were a vast majority. However, in October, the funding rate has been much closer to neutral than in previous weeks.
From the end of September to the time of writing, ETC also seemed to establish a range of $26.8 to $28. This range was broken a few days ago when ETC rallied to test the bearish order block at $29. the price faced strong selling pressure and fell.
In the event that Bitcoin dropped below the $18,600 mark, Ethereum Classic was likely to experience a sharp drop as well. Such a drop could take ETC to $24.8, a significant support level below $26.6.
Oct 10, 2022
