All things constant, Ethereum is the worst performing coin in the top 10 adding three percent on a weekly basis paling in comparison. Though we might see a recovery in the short term—dependent mostly on the performance of BTC—the lack of consensus ahead of a critical hard fork should worry investors angling for a breather once there is a successful implementation of several EIP proposals via Constantinople.
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Consensus. That’s a necessity in blockchain Proof of work systems and must be reach whenever a block is created in a proof of work systems as Ethereum. Ironically, it is missing and rare amongst Ethereum developers split in the middle over the implementation of important Ethereum Improvement Proposals (EIP) before the all-important metropolis hard fork, the Constantinople, scheduled for mid-October.
After two hours of deliberate discussions lead by Hudson Jameson on the way forward, the progress is slow to say the least. While the Constantinople is by design one of the milestone in the road towards Serenity and adoption of Proof of Stake, implementation of the hard fork’s feature reach update has been strenuous for developers. Some are even complaining saying the utopian demand for a feature rich update and limited time is the root of this pressure and potential deadline breach.
The contention around the debate aside from how the community is gearing up for a hard fork is how to best tame the proliferation of ASIC miners, way forward on ETH minerrewards and most importantly, how to best deal with Ethereum’s difficulty bomb. These three are the main cause of conflict in the network and since none is forward or backward compatible with the Ethereum network, a hard fork update—read Constantinople, is the perfect conduit to settle this once and for all.
Ethereum (ETH) Technical Analysis
Weekly Chart
In the top 10, Ethereum remains the only asset to register massive losses on a week over week basis. At current spot rates, ETH is down five percent confirming week ending Aug 12 bearish engulfing and break below candlestick.
Either way, regardless of the past weeks attempts of higher highs, when we take a top down approach, ETH is trading within a nice bear break out pattern and with every low that prints in the weekly chart, momentum and race towards $150 or lower picks up.
Looking at the chart, it’s clear that prices are in a down trend and the path of least resistance is to sell on highs in lower time frames with stops at last week’s highs.
Daily Chart
Though ETH buyers are struggling to reverse the last eight months losses, Aug 17 bullish engulfing pattern is a ray of hope for traders hoping for upsides.
However, the only caveat for that projection is adamant bears that are resilient twisting bulls towards a horizontal consolidation with short term buy triggers at $330—Aug 17 highs.
The lower limits of this move is at $250 and should there be a breach in either direction, our first targets will be anywhere between $350 and $400 on the upside and $150 on the downside with stops at lows or highs of the break out pattern dependent on break out direction. For now, bulls may be in the lead but we remain neutral until price action prints a break out.
