After weeks of decline, ethereum started a rally in early April when it traded at $350. A month later, the price had doubled to almost $800. Today, the ETH/USD pair has given up on those gains and is trading at below $600.
The recent declines are attributed to several factors. Firstly, the decline has been in sync with that of other cryptocurrencies. In the past five days, ethereum, bitcoin, ripple, and litecoin have fallen by 13.8%, 6.7%, 9.4%, and 11% respectively. These declines are partly due to the disappointing New York Consensus event convened by Coindesk.
Secondly, the declines accelerated yesterday when a report by the Federal Bank of San Francisco placed a hypothetical value of bitcoin at $1,800, which is way lower than its current price of $7,600.
Thirdly, ethereum fell after its founder, Vitalik Buterin, announced – through social media – that Google had approached him with a job offer. Traders were concerned that Vitalik would accept the role at Google, which would leave a leadership vacuum at the company.
Ethereum is currently trading at $597. The pair is trading below the 100 and 50-day Simple Moving Averages which are at $700 and $680 respectively. It is also trading at an important support as shown below. The pair’s relative strength index is currently at 37. This means that the pair could continue moving lower. Traders should start paying attention when the RSI crosses the oversold zone of 30.
