Ethereum faces price crash ahead of major update “The Merge”

The most awaited update on the Ethereum Network is near. But ahead of this major update, The Merge, Ethereum faces a price crash which has caused a panic in the market. What can be the reason behind this?

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Jay Crypto

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Last updated Aug 29, 2022 at 7:38 PM

Posted Aug 29, 2022 at 1:00 PM

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We will explore why the major price has crashed and what the next price movement of the second largest crypto asset may be. 

Ethereum Current Market Scenario

Ethereum’s price declined by 7% over the past day. In the last week, ETH fell by 9% and started to trade below the major support level of $1,520. Data from CoinMarketCap suggests the second largest crypto asset is trading below the $1500 price level.  

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We will explore why the major price has crashed and what the next price movement of the second largest crypto asset may be. 

Ethereum Current Market Scenario

Ethereum’s price declined by 7% over the past day. In the last week, ETH fell by 9% and started to trade below the major support level of $1,520. Data from CoinMarketCap suggests the second largest crypto asset is trading below the $1500 price level.  

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Ethereum Organization

Crypto experts have raised expectations for the actual merge due to the fact that testnet merges and simple news stories have caused price increases over the last two weeks. Although the long-term effect is difficult to predict, experts think the upgrade's buzz will increase costs in the short run. But the price movement of the asset over the last couple of days has proved this theory wrong. 

The biggest crypto exchange, Binance, is also preparing to support this update because it will make the crypto asset environment-friendly.  However, a bullish move of the asset is yet to be seen. The price movement of the ETH is yet not confirmed because the crypto market has several factors that can hinder the price. 

Currently, the Ethereum price faces a crash with a total bearish outlook. Let’s look at the technical side and try to predict the future of the asset. 

What will be the Future Move of Ethereum?

Following a modest month-long rise that ended around mid-August, Ethereum [ETH] bearish returned to the fray. TradingView data reveals that the sellers were helped by this reversal to push ETH below its daily 20/50/200 EMA. Currently, the ETH stands at a crucial point. A decisive decline below would trigger a further decline before chances for a short-term rebound.

The 20 EMA and the 50 EMA had to be pushed above due to the purchasing pressure from ETH's mid-June lows. From its low on July 13, the altcoin experienced an ROI of over 73% and climbed close to the 200 EMA, which indicated a growing buying advantage.

However, the $1,993 resistance level brought in a rising wedge breakdown. Recently, ETH has lost value, dropping below its immediate supply zone.

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TradingView

In the event of a bearish crossover of the 20/50 EMA, the bears would seek to maintain their long-term advantage on the chart. Therefore, ETH may be able to retest the $1,440 level if it successfully closes below the $1,500 region. If the market declines below this support, price discovery can occur. Any upward movement from the immediate support level would portend a short-term upswing toward the $1,603 level.

On the other side, the Accumulation/Distribution indicator indicates higher troughs and positive divergence with the price. A persistent upswing can portend an impending phase of accumulation, which might lessen the recent selling pressure.

Conclusion

Ethereum faces a price crash, but the event of the Merge is too big to ignore. You might see a lot of FUD which can move the market to show more volatile and erratic behavior. However, many factors can influence the market. Time will tell how the price of ETH moves ahead. Do your own research – this article is not financial advice. 

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