Ethereum (ETH) Pullback: Is it a Buying Opportunity?
Ethereum (ETH) has been a slow-motion train wreck.
Since 2018 began, the coin slipped from just over $1,400 to $197.74. That’s quite a fall for the one-time high flier. But that’s to be expected when the coin was criticized for poor scalability, delays in transactions, higher transaction costs, and vulnerability to hacker attacks.
It didn’t help when Ethereum co-founder, Vitalik Buterin says there is no chance we’ll see “1,000-times growth” in the cryptocurrency and blockchain space again.
Now, the question on every one’s mind is can it rebound?
At the moment, it’s a wait and see, but there are two catalysts.
One, the coin is aggressively oversold at support dating back to September 2017.
As long as it doesn’t fall under its recent low of $197, there’s a chance at higher highs. It’s also trading at its lower Bollinger Band (2,20) with Williams’ %R beginning to pivot higher.
Also, if it can break above its descending channel around $248, it could potentially test $300.
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The other catalyst is the Chicago Board of Options Exchange (CBOE).
The CBOE is expected to launch Ethereum futures in 2018.
CBOE will reportedly base its ETH futures on Gemini’s market. The fact the CBOE is expanding futures offerings to include cryptocurrency says it’s here to stay.
CBOE launched Bitcoin futures trading towards the end of 2017 to allow traders to speculate the price of Bitcoin without owning BTC. The futures trading is said to have contributed massively to reducing the volatility of Bitcoin since December 2017.
Reports indicate that CBOE is waiting to be cleared by the Commodities Futures Trading Commission before launching it officially.
According to Chris Concannon CBOE’s Global markets president: “SEC announced that Ethereum is not a security. This announcement cleared a block which stood between us and Ethereum futures. We have been considering launching Ethereum futures since December 2017 when we launched Bitcoin futures.”
As for the question if it’s a buying opportunity, it’s best to see if the latest push higher is real. Or, if we’re looking at a false break higher.
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