Disclaimer: The information presented does not constitute financial, investment, trading or other types of advice and is the opinion of the author only.
- A retest of the general resistance at $21.79 was likely.
- A break below $19.95 would be invalidating.
After a 12% surge on Jan. 6, Ethereum Classic [ETC] It ended up in the $19.95-$21.77 range. ETC has been trading in the above range since January 7th.
Read Ethereum Classic [ETC] predict the price 2023-24
At the time of publication, ETC is trading at $20.52 and could test the upper bound of $21.77 if demand picks up. Well, CPI data will have an important role to play here.
The US Consumer Price Index is usually used to measure inflation in the US, and speculators have been betting on it falling further.
The $21.77 Upper Limit: Is a Retest Possible?
The Relative Strength Index (RSI) stopped in the overbought territory before moving sideways. This shows that the buying pressure has eased slightly, but the bullish momentum is relatively strong.
In addition, the Money Flow Index (MFI) has rebounded from the mid-range, which indicates a significant redistribution is taking place.
Therefore, the ETC bulls may look to retest the overhead resistance at $21.77 and go higher, primarily if BTC targets the psychological $20k mark.
But a break below the $19.55 support will invalidate the bullish expectations. Such a move could prompt the bears to settle for the 61.8% Fibonacci level at $19.09 or the 100-period moving average at $18.76.
ETC mining hashrate has been rising while open interest has fallen
According to Messari, ETC mining has been decreasing steadily since mid-December 2022 and declining towards the end of December. After that, it registered a high but it has not yet reached mid-December.
Hashrate affects prices directly; Thus, an exponential decrease or increase will cause prices to rise and fall respectively. The drop in ETC hash rate since mid-December has been correlated with the drop in ETC price.
At the time of publication, there has been an increase in the hash rate, which could positively affect the price of ETC if the increase continues.
Is your wallet green? paying off ETC profit calculator
On the other hand, open interest (OI) for ETC fell further as the coin moved sideways. It appears that more inflows from the futures market as ETC traders have closed out or liquidated their positions when ETC is trading in a range.
Hidden divergence in OI/price could lead ETC to reverse direction. However, BTC’s price action may give investors more clarity on the next move.