Ethereum Classic pulls back after rally fueled by ETF approval

• ETC’s price has dropped by double digits in the last week.
• Despite the price dip, bullish momentum remains. 

Following a post-ETF-approval rally, Ethereum Classic [ETC] has begun to shed its gains.  AMBCrypto reported earlier that Ethereum-linked tokens ETC and Ethereum Name Service [ENS] climbed to 12-month highs after the long-awaited ETF decision on 10th January.

As of this writing, ETC exchanged hands at $23.90, dropping by 19% in the last week, data from CoinMarketCap showed. 

Bullish momentum remains

ETC’s price surge post-ETF approval was backed by no real uptick in demand for ETC. Now that the excitement surrounding the ETF has waned, the coin has witnessed a drop in value. 

However, despite the recent price pullback, an assessment of ETC’s price movements on a daily chart revealed that bullish momentum persisted. At press time, the coin’s momentum indicator rested above their respective center lines, suggesting that buying pressure exceeded coin sell-offs.

Further, the coin’s Chaikin Money Flow (CMF) returned a value above the zero line. When an asset’s CMF value rests above zero, it signals the presence of more buying pressure.

At 0.06 and in an uptrend when writing, ETC’s CMF showed rising liquidity being supplied to the coin’s spot market. This is known to drive up an asset’s value.

Confirming the bullish trend, readings from ETC’s Directional Movement Index (DMI) showed its positive directional index (green) resting above the negative directional index (red).

When these trend lines are positioned in this manner, it suggests that the strength of the bulls exceeds that of the bears. 

Source: ETC/USDT on TradingView

However, the price decline experienced in the last week has resulted in a fall in ETC’s futures open interest. According to data from Coinglass, since 12th January, ETC’s open interest has plunged by 22%.

As of this writing, the coin’s futures open interest was $162.34

Volatility lingers in the market

The hike in ETC price post-ETF approval led to a surge in market volatility.

With the gap between the upper and lower bands of the coin’s Bollinger Bands (BB) indicator still widening at press time, ETC remained prone to price swings. 

Source: ETC/USDT on TradingView