Ethereum is down by 9% plunging below the crucial support of $3,000. Currently, the ETH price is trading at $2812 with a market cap of $341 billion. The altcoin is now consolidating above the $2,800 level. The initial resistance lies at the $2,900 zone.
However, if the bears continue to rule, the first key support is at the $2,800 level. A downside break below the $2,800 level might start another strong decline.
Ethereum Price to Bounce In The Near Future?
Ethereum, the dominant smart contract platform, is oversold, according to a famous crypto expert. The host of InvestAnswers informs his 402,000 YouTube subscribers in a new strategy session that the second largest crypto asset by market cap is flashing signals that suggest a price increase is on the way.
The relative strength index (RSI) Of ETH is at the same level as it was in late May of last year when it began a relief rally, and again in June of last year, just before it reversed and eventually reached all-time highs, according to the expert.
“When we look at [ETH’s] RSI and we compare that to the bottom prices and how those prices break through the 200-day moving average, it’s quite uncanny. So we have three areas where RSI has breached [the 200-day moving average]. We have May and June of 2021 and January of 2022.”
Ethereum is extremely oversold, which coincides with prior price bottoms that almost precisely match up with the 200-day moving average. We’re currently lower than we’ve ever been below the 200-day moving average. This tells me that we’re in for a bit of an ETH bounce in the near future.”
The host then displays the market value to realized value (MVRV) of the top altcoin, which determines if an asset’s price is overpriced or undervalued in comparison to its true market value.
The RSI corresponds to the MVRV Z score, which indicates whether Ethereum is overvalued or undervalued in relation to its fair value. It has historically indicated a market top when the market value is much higher than the realized worth… The last market peak occurred in May 2021. Otherwise, where we are now is in the kill zone, totally oversold. We’ve only had three of these in the last year and that corresponds directly to the RSI.
Source: https://coinpedia.org/ethereum/ethereum-in-extremely-oversold/