Crypto trader Jason Pizzino warns that Ethereum (ETH) could undergo a heavy correction after experiencing a modest rally this week.
In a new video, Pizzino tells his 279,000 YouTube subscribers that Ethereum’s bear market downtrend remains intact despite the second-largest crypto asset by market rallying by over 10% this week.
“We haven’t broken the bear market downtrend on the log scale yet, we haven’t got past the monthly swing tops here at around $1,700 and $2,000. So there’s still a little bit of resistance or a significant amount of resistance to the upside for ETH.”
Ethereum is trading at $1,400 at time of writing.
Pizzino says that despite Ethereum looking bullish for the short-term, that could change if the US dollar appreciates and Bitcoin (BTC) and other risk assets turn bearish.
“If Bitcoin does happen to turn down and the S&P [stocks index] starts to turn down, the dollar index starts to rise and put pressure on the commodities, and of course, these risk assets will also be hit, then maybe we start to see Ethereum roll over.”
According to the analyst, Ethereum could hit a low last recorded in December of 2020 once the critical support levels crumble.
“These are going to be the two key areas – $1,080, watch that level, and then also watch $880 as well.
If these levels start to break, then we’re probably going to test this particular zone right here [between $700 and $900] and that could lead to some much cheaper ETH prices.
Hopefully, we can get something between sort of $700 and $900 on ETH. Long way off, maybe it doesn’t happen. But they are the key areas to watch here for Ethereum.”
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