By Dmitriy Gurkovskiy, Chief Analyst at RoboForex
ETH keeps declining, trading at $169.03 this Thursday.
Looking at the Ethereum on the weekly timeframe, we may see that after the correctional growth to 38.2% Fibo, the quotations are developing a new wave of declining to the important level of $80.86. Further decline is confirmed by the descending of the MACD lines and the red histogram. However, the ascending dynamics of the Stochastic warns about a possible bounce and a new impulse of growth to 50.0% ($455.00).
On the daily ETH/USD chart, the downtrend is aiming at 76.0% ($163.20) in relation with the previous uptrend. However, as the main aim of the short-term decline we may regard the support level of $137.00. Along with the decline, there is a convergence forming, warning about an upcoming pullback with a probable goal at $231.45.
On H4, we can see a harmonic descending channel, while the Stochastic is forming a convergence, which may serve as another confirmation of the pullback idea. However, we should wait for a Gold Cross to form.
According to the director of Blockstream Samson Mow, the Ethereum is stuck in a technological deadlock due to the unresolved problem of scalability. The issue is literally killing the cryptocurrency: the more it is used, the closer its end.
Mow presumes that the trouble must be partly due to the fact that the biggest part of the use of the Ethereum belongs to the stablecoin Tether. Thus, commission fees in the network will be growing too fast, and sooner or later the developers will simply opt for another blockchain.
Vitalik Buterin, the Ethereum creator, replied to the critic, attracting his attention to the fact that the Bitcoin network at the moment is as overwhelmed as the Ethereum network, so there is nothing disastrous going on. However, Mow points at the difference between the scalability of the BTC and ETH, saying that the Ethereum is more compromised because the network is used for calculating various data and needs faster development.
Meanwhile, the inner news of the Ethereum are not flawless. The update of the Istanbul network, scheduled for October 4th, is postponed till November, at least. This happens because the developers cannot complete the renewal of the cryptocurrency code on time.
Disclaimer: Any predictions contained herein are based on the authors’ particular opinion. This analysis shall not be treated as trading advice. RoboForex shall not be held liable for the results of the trades arising from relying upon trading recommendations and reviews contained herein.
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