Ever wondered how sustainable the recovery of Ethereum Classic (ETC) is after its recent rebound? Well, it’s time to dive deep into the analysis of ETC’s recent performance. The cryptocurrency ETC rebounded off a significant long-term support point, sparking discussions about the longevity of its recovery. However, it is important to note that while there has been a recovery, there are still substantial challenges that could hinder its progress.
ETC’s Recovery: A Look at the Obstacles
The rebound of ETC from a key long-term support zone between $14.7 and $16.2 has been remarkable, leading to three consecutive price recoveries. This support zone has consistently attracted substantial demand whenever the price action retested it. However, the expected fourth recovery might encounter some roadblocks.
Despite the Chaikin Money Flow (CMF) indicating significant capital inflows, the Relative Strength Index (RSI) hasn’t crossed the 50-median mark yet, which suggests improved but not quite strong buying pressure. This means that ETC’s recovery could face its first major hurdle, namely, the price imbalance and Fair Value Gap (FVG) ranging between $16.7 and $17.4. In addition, a former support-turned-resistance zone of $17.8 – $18.6 sits above the FVG, potentially posing another obstacle for the ETC bulls.
Futures Market: A Lack of Demand
While ETC rebounded in the spot market, its demand in the futures market left much to be desired. The Open Interest (OI), which measures opened contracts and thus reflects demand, liquidity, and overall market sentiment, showed that the demand for ETC was lackluster. Moreover, the Cumulative Volume Delta (CVD) was on a downward trajectory, further underscoring the muted demand and the absence of a bullish edge in the market.
ETC’s Journey Towards the $20 Mark
ETC’s journey towards the psychological level of $20 is fraught with key hurdles that could potentially derail the bulls. While the recovery has been noteworthy, it is important to monitor these hurdles closely to understand if the recovery is sustainable in the long run.
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