- ETC is facing bearish risk due to the short-term bubble signal.
- ETC continues its battle against Bitcoin.
Ethereum classic [ETC] has retained its original blockchain history since the DAO hack, unlike Ethereum [ETH]creating a new version of the network.
ETC, which was worth $18 at the time of writing, significantly lagged Ethereum’s value of $2,300.
A recent analysis shows that bubble risk for ETC has turned bearish in the near term, possibly indicating a continuation of the downtrend.
This negative outlook is supported by several indicators pointing to a further decline. Since peaking at $186 in April 2021, ETC has been in a consistent downtrend.
Source: IntoTheCryptoverse
ETC’s Valuation Relative to Bitcoin [BTC]the leading cryptocurrency, has also fallen. This trend mirrors Ethereum’s performance and highlights BTC’s dominance in the market.
While the crypto market generally tends to post gains in the last quarter of the year, ETC’s weak valuation suggests that this market may not follow this pattern.
Historically, Bitcoin’s strength has often impacted other cryptocurrencies, but ETC appears vulnerable to continued decline despite the usual fourth-quarter optimism.
Source: IntoTheCryptoverse
ETC below weekly MAs, but trendline broken
Further signs of ETC’s weakness are evident in the moving averages. It was trading below all of its Simple Moving Average (SMA) at the time of writing, including the 8-day SMA, which indicated a bearish trend.
This downward move highlighted the increased risk for traders holding Ethereum Classic or considering entering the market for potential gains in the fourth quarter.
For futures traders, shorting ETC could be a viable option, especially since trading below moving averages typically indicates a bearish trend direction.
Source: IntoTheCryptoverse
However, there is still a glimmer of hope for Ethereum Classic. A technical analysis of the ETC/USDT pair shows a recent break above a descending trendline, which has been suppressing the price since May 2024.
Trendline breaks often indicate potential market reversals, and ETC’s move above $18 signals the possibility of a bottom formation. If the price stays above this level, it could rise to $25, giving a potential gain of more than 40%.
Source: TradingView
On the other hand, if ETC fails to hold its current support and falls below the key USD 18 level, the decline could continue. A break below this critical level would likely lead to further price deterioration.
Read Ethereum Classic’s [ETC] Price forecast 2024–2025
While Ethereum Classic faces significant bearish risks, the possibility of a short-term rally remains if broader market conditions improve.
As always, the future of Ethereum Classic largely depends on market dynamics and the performance of other major cryptocurrencies.
