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Ethereum Classic (ETC) is on the rise, gaining 2.3% and trading around $22.60 as of Friday. This surge comes after testing a key support area the previous day, with on-chain data indicating increased account growth—a promising sign for a bullish move ahead.
Ethereum Classic price faced rejection at the daily resistance level of $25.13 earlier in the week. This rejection led to an 8% decline over the next two days, testing its support area between $20.89 and $21.63 on Thursday. As of Friday, the price has rebounded, trading at $22.60, a 2.3% increase.
Key Support Area Holds Strong
The crucial support area between $20.89 and $21.63 has held, leading to this rebound. If this area continues to provide support, the Ethereum Classic price could rally by 12% from the current level to retest its daily resistance at $25.13.
The Relative Strength Index (RSI) on the daily chart has briefly dipped below the neutral level of 50. Similarly, the Awesome Oscillator (AO) is heading towards its mean level. For the bulls to take control and continue the upward momentum, both indicators need to regain their positions above their respective mean levels. Such a development would likely bolster the recovery rally.
If bullish sentiment prevails and the overall cryptocurrency market remains optimistic, Ethereum Classic price could close above the $25.13 mark. This breakthrough could push the price up by another 12%, aiming for the 61.8% Fibonacci retracement level at $28.17. This level is plotted from the May 23 high of $34.35 to the July 5 low of $18.19.
On-Chain Data Signals Growth
According to Ethereum Classic Explorer, ETC account growth increased from 9.49 million in late May to 9.61 million in late July. This increase in account numbers typically signals growing interest in and adoption of the Ethereum Classic network. The more accounts that are created, the more users are engaging with the network, which is often a bullish indicator.
Additionally, the Long-to-Short ratio, provided by Coinglass, offers insights into traders’ and investors’ sentiment towards Ethereum Classic price. A high long-to-short ratio suggests that more traders are betting on the coin’s price increasing, indicating bullish sentiment. In the case of ETC, the Long-to-Short ratio stands at 1.58. This means there are approximately 1.58 times as many long positions as short positions, signalling bullish sentiment among ETC investors.
Potential Risks and Caution
Despite the positive on-chain metrics and technical analysis pointing towards a bullish outlook, there are risks to consider. If Ethereum Classic price’s daily candlestick closes below $19.27, the bullish thesis would be invalidated. This would produce a lower low on the daily timeframe, potentially leading to a 12% crash, bringing the price down to the daily support level of $16.91.
While the current data suggests a potential bullish move, market conditions can change rapidly. Investors should keep a close eye on the support levels and the daily close to manage their positions effectively.
Conclusion: Watching Ethereum Classic Price Closely
In summary, Ethereum Classic price has shown a promising rise, with key support levels holding strong and on-chain data indicating increased interest in the network. If the support area between $20.89 and $21.63 continues to hold, there is potential for a 12% rally to retest the $25.13 resistance level. Beyond that, a further 12% increase could be on the horizon, targeting the $28.17 Fibonacci retracement level.
However, caution is advised. A daily close below $19.27 would invalidate the bullish outlook and could lead to a significant price drop. Investors and traders should monitor the Ethereum Classic price movements closely, keeping an eye on technical indicators and market sentiment to navigate this volatile landscape.
By staying informed and vigilant, investors can make the most of the opportunities presented by the fluctuating Ethereum Classic price while managing potential risks effectively. Stay tuned for more Ethereum Classic updates on TurkishNY Radio.
