Ethereum (CRYPTO: ETH) was plunging over 6% at one point on Thursday, in sympathy with the general markets and the crypto sector, which were being pummeled.
Bitcoin (CRYPTO: BTC) had dropped over 6% during the 24-hour trading period by press time, while the S&P 500 took a 3.4% nose-dive at one point before recovering slightly.
The cryptocurrency sector has been frustrating for traders and investors over the past many months, with multiple bull and bear traps in both directions, while the overall trend has been south.
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The Ethereum Chart: On Wednesday, Ethereum surged over 6% on high volume, which made it appear the crypto was breaking up bullishly from a falling channel pattern that’s been holding Ethereum in a downtrend since April 5. The break up from the pattern turned into a bull trap, however, and on Thursday Ethereum plunged back into the channel.
- If Ethereum closes the trading day near its low-of-day price, the crypto will print a bearish engulfing candlestick, which could indicate lower prices will come again on Friday. The second most likely scenario would be the development of an inside bar to consolidate the steep drop.
- If Ethereum bounced up before above the $2,800 level to close the 24-hour session at 8 p.m., the crypto will print a hammer candlestick, which could indicate higher prices will come on Friday. If that happens, the most likely scenario is that the crypto will print another lower high and continue in its downtrend.
- Ethereum has resistance above at $2,890 and $3,057.82 and support below at $2,609.02 and $2,461.63.
See Also: Crypto Whale Just Moved $37M Worth Of Ethereum Off Gemini
