Ethereum Classic (ETC) steadily retreated into a bearish channel (yellow) for over three months. Post that, the bulls started a breakout, but quickly got back on the back foot.
Despite the recent rejection of lower prices, the 20 EMA (red) and the upper trendline of the bearish triangle offered strong resistance over the past month. So a retest of the flatter USD 24 support before a trend move seemed possible for ETC in the coming days. As of going to press, the alt was trading at $27.27.
ETC Daily Chart
The down-channel retracement saw a drop of nearly 66.9% as it pushed through vital price points. For example, the bears have flipped the $34 mark from support to resistance.
However, ETC posted an ROI of over 75% from its nine-month low on Jan. 22, when it jumped above the 20/50 EMAs. But it struggled to topple the $34 mark as it formed a bearish divergence (white trendline) with its RSI. the bears refrained from giving up their control.
Over the past five weeks, ETC has aggressively marked lower highs while testing the USD 24 support. Thus, a bearish triangle was formed that reaffirmed the increasing bearish tendencies. To top it off, a recent bearish engulfing candlestick created a strong supply zone in the $27-$30 range.
Now, while a reversal from this range is likely, ETC has been aiming to continue its push toward the $24 mark. Any bounce from this sign could find resistance at the top trendline of the triangle before the alt conforms to its bearish tendencies. Any close below the $24 mark would confirm the malfunction and cause a short signal.
The RSI fell below the midline while trendline resistance remained intact. A close above the line could stimulate a near-term recovery. Therefore, the sellers had to protect the balance to avoid any rebound opportunities.
The CMF also dipped below the zero line, confirming the increasing sales advantage. This lecture portrayed the underlying perception for the crypto favoring the bears. Nevertheless, the ADX for ETC was on the decline, confirming a fragile directional trend.
Given the heightened bearish tendencies over the past five weeks, reflected by the formation of a bearish triangle, ETC may be bracing for a setback towards USD 24. After that, the bulls had to step in to prevent a substantial decline towards $22.
In addition, broader market sentiment and supply chain developments would play a vital role in influencing future movements.