Ethereum fell on Wednesday, falling below the $600 level and dropping $50 or 8% on the day. This is a bearish candle and setup that leads me to believe a retracement is due and ETH will be heading back down to put in a higher low.
(November 25, 2020 8:30PM EST)
Outlook: Ethereum dropped during the Wednesday trading session, falling beneath the $600 level and losing nearly 10% as $600 proves to be resistance, for now. I think this is but a short-term resistance and, frankly, a very healthy and modest uptrend relative to Bitcoin's parabola since September. I think a pullback to the $500 level makes a lot of sense as it was previous resistance in Aug/Sept. and should now act as support. If it does, I expect ETH to continue up to $600 and above; $700, $800, all the way up to $1,000. If ETH falls below the $500 level, look for support around $450, which is the lower end of the recent bullish consolidation range and just above the 50 Day EMA underneath around $433.
Given the bearish macro global economic environment and the fervent buoying of fixed-supply assets like ETH, I think the path of least resistance is up, especially the lower ETH gets. A pullback to $500 and I expect value-hunters to come in, as I think ETH is way underpriced and, in the medium-term, anything below $1,000 is a steal.
ETH 2.0's deposit contract reached and even exceeded its 524,000 ETH staked threshold and is set to launch on its originally intended date in early December, which is bullish for ETH as a rough timeline for staking yields comes closer to being a reality.
Support: Look for support at $500, which is former resistance and a large, round psychological number. Below that, $450, the 50 Day EMA at $433 and rising, and $400, which should provide ironclad support.
Resistance: Eyes are on what happens around $600, as a break above points to $700. Once ETH gets moving, especially with a potential bullish catalyst with the ETH 2.0 beacon chain secured to launch on time, ETH can get some bullish footing and climb to the $1,000 figure just as quickly as Bitcoin did recently, and that was to the ATH.
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