Imagine being able to measure the level of demand for a cryptocurrency by the strength of its bounce. Ethereum Classic would have been worth watching, especially after a 260% rally from 2022 lows. But the question is, can the same momentum be maintained in the next stage of recovery?
Ethereum Classic’s press-time price of $32.91 represents a 27% drawdown from the most recent monthly high. This means that the price is still holding up significantly when compared to June’s price action. The fact that ETC has fallen by relatively small margins over the past seven days could be a healthy sign of strength.
ETC’s recent drop has retested support around the 0.5 Fibonacci level. At the time of writing, the bears are experiencing friction near this level, confirming easing selling pressure at the $32 level.
Source: Trading View
Ethereum Classic’s press time position looked like a healthy recovery zone, but we’re not clear on the potential outcome. Trading volume has decreased significantly in the last 24 hours. This shows that investors are not thrilled.
The volume observation can also be interpreted as investor inaction due to uncertainty after the recent selloff. This correlates with an increase in the share of stablecoin supply held by whales.
Source: Santimento
ETC whales are cashing out as prices skyrocket during the rally of relief. In fact, it is still quite possible that ETC will fall below the press time level.
Positive sentiment dropped significantly over the past 48 hours, while negative sentiment registered an increase.
Source: Santimento
The observed change in sentiment means that price action may lean toward greater selling pressure on the chart.
Conclusion
The ETC indicator highlighted a significant level of uncertainty as far as short-term price action is concerned. However, the crypto market fluctuates regularly and everything is still correlated. This means that ETC is still affected by overall market sentiment.
Especially this month, ETH remains a healthy tradable cryptocurrency. Its trading volume has been growing healthily over the past few months. This is likely due to riding on the Ethereum Merge hype.
