Ethereum has struggled to gain momentum on lower time frames with a 12.46% decline over the past week.
It is currently trading 3.1% lower than yesterday’s daily candle close at $156.22, which signals that a retest of the $151 level of support may be on the cards in the coming days.
It’s worth noting that last week’s rally to $176 was halted by a gruelling rejection from the daily 200 moving average.
Until Ethereum can pick itself up and trade back above the 200MA it remains in a more bearish pattern in the short-term.
A break above $176 would pave the way for a rally back towards its yearly high of $289, which ties into the bullish narrative surrounding the Bitcoin halving event in May.
While Ethereum and Bitcoin are two very different assets, price action is often correlated so when Bitcoin makes a major move Ethereum and other altcoins will likely follow.
This is why speculators are hoping that the Bitcoin halving can have its desired bullish effect on the market, thus causing the likes of Ethereum to surge exponentially.
Next month rewards for Bitcoin miners will be slashed from 12.5BTC per block to 6.25BTC per block, effectively halving the supply that will come onto the market.
Furthermore, miners need to ensure that mounting electricity costs and overheads are met by mining profit. When the rewards are halved the price will need to double in order for the margins to remain the same.
From Ethereum’s standpoint the key remains trading back above the daily 200 MA before the Bitcoin halving as it would provide an ideal platform ahead of a potential cryptocurrency bull market.
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Ethereum was launched by Vitalik Buterin on July 30 2015. He was a researcher and programmer working on Bitcoin Magazine and he initially wrote a whitepaper in 2013 describing Ethereum.
Buterin had proposed that Bitcoin needed a scripting language. He decided to develop a new platform with a more general scripting language when he couldn’t get buy-in to his proposal.
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