Ethereum Classic (ETC) successfully defended its support against Bitcoin (BTC). Initially, ETC/BTC crashed hard along with the rest of the market. However, Ethereum Classic (ETC) crashed even harder making it one of the biggest losers next to Icon (ICX) and Stratis (Strat) both of which crashed a lot more aggressively. Yesterday’s crash resulted in the last few weak hands being shaken out and their ETC transferred to strong hands. Before any trend reversal, it is healthy to see such developments. The price cannot recover effectively in the presence of weak hands who buy and sell based on sudden whims. Even though ETC/BTC crashed hard, it remained above the long term support. The price bounced strongly off the trend line and closed well above it on the daily time frame.
Technical indicators especially the RSI show signs of a trend reversal. Of course the price can continue to drop even as RSI remains in oversold territory. However, at this stage most of the technical indicators point to the same outcome which is an imminent trend reversal. Most cryptocurrencies are once again at their critical trend lines. The price did fall significantly mainly because of the infighting in the Bitcoin Cash (BCH) community. However, it must not be forgotten that most bears had given up until yesterday. Some of them might have changed their mind recently given that the recent crash has instilled more fear in the market, but the fact remains that most of them are not ready to pull the trigger on any bearish positions.
Selling ETC/USD now is no different than buying at the top. For all we know, this whole drama in the Bitcoin Cash (BCH) community that has led to the recent sell off could be an elaborate ploy to trap in more bears before the bull run. If anything, we have seen that the influence two people can have over the market. So, if they trap in leveraged sell positions on exchanges like Bitmex or Bitfinex, they can hit them the same way and profit enormously. Even if they don’t, realizing the risks that a few powerful hands can put you out of your positions should be a strong reason in itself to not go long or short on margin at this point. That being said, we now know that both Craig S. Wright and Jihan Wu have a ton of coins that they can move the markets with.
If they sell now, someone would be more than happy to take their coins, and with that the influence those coins can wield. If you think Craig Wright or Jihan WU is prepared to do that, and if you think that all the major players like Binance, Coinbase and Bitmain are going to allow the price to break a decade long trend line, then by all means open sell orders. This last shakeout is nothing more than a careful ploy to shakeout all the weak hands and grab their favorite altcoins at dirt cheap prices. Ethereum Classic (ETC)’s strong bounce off its support shows that for every weak hand willing to sell their ETC at this stage, there is a strong hand happy to buy it from them.