Disclaimer: The information presented does not constitute financial, investment, trading or other advice and solely reflects the opinion of the author.
- ETC rallied on crucial long-term support.
- Demand in the derivatives market was weak.
classic Ethereum [ETC] it has recovered from the critical long-term support at $14.7-$16.2 (cyan). The support zone has triggered three consecutive price rallies. But the recent recovery could face significant obstacles.
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Meanwhile Bitcoin [BTC] The rally was set at $26.8K and could decline to $26K before attempting another upswing.
The Obstacles to ETC Recovery
Source: ETC/USDT on TradingView
As the daily chart above shows, the Cyan support zone triggered a rally in January, March, and June. Therefore, it is a crucial long-term support that has seen massive demand every time price action retests it.
However, the expected fourth recovery could be delayed and derailed by obstacles. The CMF was above the zero threshold, meaning capital inflows were significant.
But the RSI had not crossed the mid-50 level and was showing improved but not as strong buying pressure at the time of writing.
The first hurdle for ETC bulls is the price imbalance and the FVG (Fair Value Gap) of $16.7-$17.4 (white). Additionally, there is a previous support and resistance zone at $17.8-$18.6 (red) above FVG.
Therefore, the rally towards the psychological $20 level poses important hurdles that could derail the bulls.
Demand on the futures market subdued
Source: CoinAlyze
Demand for ETC has been dismal in the futures market, Open Interest (OI) shows. OI measures open contracts to capture demand, liquidity and general market sentiment.
Read Ethereum [ETC] Price prediction 2023-24
Notably, the metric saw a solid recovery after the decline in mid-August.
Additionally, funding rates fluctuated as the CVD (Cumulative Volume Delta) declined, further confirming the weak demand and lack of upside in the market. Therefore, the recovery could face challenges.
Source: ambcrypto.com
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