Crypto Market Review, October 31

Ethereum was most­ly the rea­son behind the most recent growth on the cryp­tocur­ren­cy mar­ket as the sec­ond biggest cryp­tocur­ren­cy rushed toward the local resis­tance and suc­cess­ful­ly broke it. Despite los­ing momen­tum, the con­tin­u­a­tion of the ral­ly is still possible.

$1,800 is next destination

While Ether has not yet reached the next psy­cho­log­i­cal lev­el at $1,700, the real resis­tance for the sec­ond biggest dig­i­tal assets in the world is a bit high­er from a tech­ni­cal per­spec­tive. The $1,700 will most like­ly get bro­ken rel­a­tive­ly fast if Ether gains momen­tum on the mar­ket, but $1,800 is anoth­er story.

Accord­ing to the dai­ly chart of ETH, bulls have formed a sol­id resis­tance at $1,775, which is being con­firmed by the cross-exchange order­book. There are two rea­sons behind it: the 200-day mov­ing aver­age and the his­tor­i­cal resis­tance lev­el that formed after Ether broke down from $1,780 and lost almost 20% of its val­ue in a few days.

The points of large and strong break­downs usu­al­ly turn into resis­tance lev­els as investors tend to sell assets active­ly to break even. As this process repeats, con­sol­i­da­tion chan­nels are form­ing and caus­ing pro­longed con­sol­i­da­tions. Once traders get rid of most of their funds, a new break­out becomes a mat­ter of time.

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For now, Ethereum is mov­ing side­ways due to lack of vol­ume on the mar­ket. The most like­ly rea­son behind the lack of momen­tum could be tied to increased fears among investors caused by the over­sold nature of Ethereum.

How­ev­er, even a slight cor­rec­tion or con­sol­i­da­tion will lead to RSI return­ing to the nor­mal zone, which will be a sig­nal for investors and traders to resume inflows on the market.

Dogecoin needs it for continuation

The meme­coin’s 140% revived inter­est in risky assets once again. How­ev­er, it was not easy to keep up the pace we saw on DOGE from the begin­ning, and the most impor­tant thing the meme­coin needs right now is a correction.

The con­tin­u­a­tion of the ral­ly will most cer­tain­ly cause even more retail inflows to the coin, which is a neg­a­tive fac­tor for assets that go through a volatile ral­ly. When­ev­er the first cor­rec­tion hap­pens, the mar­ket will not be able to cov­er the exist­ing sell­ing pres­sure and Doge­coin will face the fate of assets like Shi­ba Inu.

How­ev­er, a cor­rec­tion at the right time will allow the meme­coin to cooldown and then pro­ceed upward. Dur­ing the last ral­ly in April 2021, Doge lost almost 70% of its val­ue after the first cor­rec­tion fol­low­ing the pump but man­aged to climb even fur­ther since the rever­sal that allowed DOGE to cooldown appeared a few days after the ini­tial pump.

At press time, Doge­coin is trad­ing at $0.12 with a 3.4% price increase in the last 24 hours, but con­sid­er­ing its volatil­i­ty, the sit­u­a­tion on the mar­ket might change dras­ti­cal­ly in a mat­ter of hours.