Ethereum has been caught within the throes of immense bearishness over the past couple of days, with sellers leading the cryptocurrency to underperform Bitcoin is it smashes through key support level that had been developed throughout the course of its intense 2020 uptrend.
Analysts are now noting that the current selloff may cut significantly deeper, but there is one key support level that could be enough to spark its next major uptrend.
How the cryptocurrency reacts to this level should provide investors with insight into the state of its current trend.
Ethereum Plummets in Tandem with Bitcoin and Aggregated Crypto Market
The intense selling pressure incurred by Bitcoin and the aggregated crypto market last Wednesday seems to have done significant damage to the market’s previous bullishness, as analysts are now widely noting that further downside is imminent.
Currently, Ethereum is trading down 5.2% at its current price of $250.70, which marks a notable decline from daily highs of over $260.
ETH has also declined against its Bitcoin trading pair, as it is currently underperforming the benchmark cryptocurrency by 2.5%.
This current bearishness comes closely on the heels of Ethereum’s recent parabolic rally, which had previously led many analysts to believe that the crypto was bound to see significantly further gains.
Analysts are now noting that it may first drop into the lower-$200 region before finding any notable support.
George, a popular crypto trader on Twitter, spoke about this in a recent tweet, saying that Ethereum is “looking weak” and may not see a relief rally until it reaches roughly $220.
“ETH: Didn’t manage to break above. Looking weak. Dip into blue is a buy imo. Let’s see!”
Didn’t manage to break above. Looking weak. Dip into blue is a buy imo. Let’s see! pic.twitter.com/rhAXOlkrtk
— George (@George1Trader) February 25, 2020
If the embattled cryptocurrency does dip to this aforementioned range, it will mark a full retrace of its recent parabolic gains, as this is around where the cryptocurrency began its sharp vertical ascent earlier this month.
One factor that could provide some long-term bullishness to ETH is the fact that it has been categorized as a commodity by regulators, which has led many analysts to note that its long-term prospects are incredibly bright.
“I’m bullish on ETH? It’s a commodity. Take ENG as an example, it is a security now. Many will follow. Regulations will evaporate the tokens in their current form. Access to their new form will be limited to accredited investors initially. Ethereum will remain non exclusive,” Bitcoin Jack – a popular analyst – explained in a tweet.
I’m bullish on $ETH?
It’s a commodity
Take $ENG as an example, it is a security now
Many will follow
Regulations will evaporate the tokens in their current form
Access to their new form will be limited to accredited investors initially
Ethereum will remain non exclusive
— //Bitcoin 𝕵ack (@BTC_JackSparrow) February 25, 2020
Although this fact may not be enough to provide ETH with any short-term upwards momentum, it is highly probable that it will help it climb higher in the months and years ahead.