Cryptocurrency’s second-largest project in terms of market cap, Ethereum, completed a 45% correction to below $200 yesterday evening.
The substantial drop in the price of Ethereum comes just three weeks after it hit yearly highs of $365.
It hasn’t been the only altcoin to suffer in recent weeks either, with $120 billion being wiped from the cryptocurrency market cap since June 26.
While support has now been established at the $200 mark for Ethereum, the lack of a bounce or significant buy volume could suggest that this level won’t hold for long.
The next level of support to the downside comes in at around $180, which would mark yet another 10% drop in price.
From a fundamental standpoint, in 2017, Ethereum rallied alongside Bitcoin before eventually peaking at an all-time high of $1,420. The difference in 2019 is that the hype surrounding ICOs has withered away, leaving Ethereum as a platform fairly unused.
During the last bull run, the Ethereum network was clogged with newcomers looking to hop on board the latest ERC-20 project. But today, there is a severe lack of projects worth investing in.
This is one of the main reasons why Ethereum has stuttered this year, despite Bitcoin rallying from $3,150 to $14,000.
While there is a lack of bullish cases for Ethereum, regaining price above the 200 exponential moving average (EMA) on the daily chart could establish a platform for a further rally to the upside.
The 200 EMA is currently sitting at around $220, but a rally would need to happen within the next week to avoid the dreaded death cross, which would see the 100 and 55 EMAs cross to the downside.
For more news, guides, and cryptocurrency analysis, click here.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.