In yesterday’s trading session, the price of Ethereum Classic surged more than 20%, breaking through the long-term resistance level of $18. This also resulted in the crypto trading above a price level it hasn’t reached since mid-December, signaling a possible reversal in price.
However, in today’s trading session, Ethereum Classic seems to have resumed its long-term bearish trend, with its value dropping 2% in the first few hours of the trading session. The current bearish move also looks poised to continue throughout the session, with intraday trading showing a significant ongoing sell-off.
Is Ethereum Classic Poised for Recovery in 2023?
Yesterday’s aggressive bullish trend gave optimistic investors hope that we might see Ethereum Classic recover this year. However, despite the surge appearing to be a price reversal, the chances of the Ethereum Classic recovering in 2023 are still low.
One major factor that will hinder its continued rise is its correlation with the industry. Currently, the crypto industry is in an aggressive bearish trend, with major coins such as Bitcoin and Ethereum also showing signs of weakness. Ethereum Classic, which often trades in the same direction as Ethereum, is therefore likely to be impacted by the current bearish trend of the industry.
Yesterday’s price surge also seems to have been caused by a spontaneous increase in trading volume. Unfortunately, it is highly likely that the momentum from yesterday will not be sustained for the next few months. This will likely result in a continued drop to levels it was trading at before yesterday.
Finally, despite yesterday’s trading session showing a huge spike upwards, the long-term price action, as seen on the chart below, is still bearish. Therefore, for the next few trading sessions, I expect the bearish trend to continue. There is a high likelihood that we might see prices trading below the $15 level again. However, a trade above the $25 level would invalidate my analysis.