Ethereum Classic: Is it time to negate yet another bearish setup on the chart

Disclaimer: The findings of the next evaluation are the only real opinions of the author and shouldn’t be taken as funding recommendation

Though Ethereum Basic has maintained a optimistic ROI of 6% in October thus far, a bunch of altcoins have managed to outperform the world’s twenty ninth largest cryptocurrency. On the chart, ETC’s worth motion has been largely resulting from a double prime and a collection of flash crashes in September.

Regardless of a slight restoration in the course of the first week of October, an impeding descending triangle tainted ETC’s near-term outlook. On the time of writing, the crypto was traded at $52.4, down by 0.9% over the past 24 hours.

Ethereum Basic 4-hour Chart

Supply: ETC/USD, TradingView

Regular lows round $51.4 mixed with decrease highs over the previous week, indicating a descending triangle setup on ETC’s 4-hour timeframe. On the time of writing, the 200-SMA (inexperienced) was delaying a fifth assault on the underside trendline however count on this base to be examined as soon as once more if bears negotiate previous the long-term transferring common line.

Ought to bulls fail to comprise promote stress above $51.4, ETC can be on the danger of a breakdown from the sample and a doable 13.5% depreciation in worth. Consumers can hit again at near-term assist ranges of $48.2 and $44.3.

Curiously, it’s price mentioning that ETC has negated the final 2 descending triangle setups – One in mid-July and the opposite in late September. The truth is, the alt has commenced on an upwards run on each events as bulls formulated a breakout of their very own.

If an analogous improvement have been to happen primarily based on these findings, ETC would eye a northbound transfer from the sample. In line with the highs and lows inside the setup, ETC focused an 11% soar from the breakout level. Furthermore, an in depth above $60.6 on robust volumes would enable bulls to hunt extra aggressively for added worth ranges.

Reasoning 

Market observers ought to preserve an in depth eye on ETC’s RSI for extra readability when it comes to a breakout. The RSI, which additionally traded inside a descending triangle, would aspect with a bearish end result in case it weakens under the 35-support.

Conversely, bulls would hope to keep up the RSI inside the sample and goal a peak above 50-55. In the meantime, the MACD remained bearish-neutral whereas a slight bullish divergence was noticed on the Superior Oscillator.

Conclusion 

ETC was virtually break up evenly between a bullish and a bearish end result. If bears can provoke an in depth under $51.4 or if the RSI declines under 35, ETC can be uncovered to a 13.5% drawdown.

However, bulls will look to defend in opposition to one other assault on the baseline – A improvement that might drive a transfer of their favor.