After problems arose on the Beacon Chain (an Ethereum test network), the price of ETH plummeted by almost 12%, re-injecting fear into the entire crypto market.
At the time of this writing, ETH is trading at $1,872, accumulating a loss of 6.58% in the last 24 hours.
The test chain called Beacon, is a test platform that is currently online, and with which it is expected to give way to a main network validated by proof of stake, which is a more efficient and scalable protocol.
The Beacon Chain, which is preparing to introduce the new transaction validation model, underwent a deep reorganization of 7 blocks in recent hours, which is usually performed when malicious activity or network error occurs.
The market quickly responded with negativity to the news. Now we see a sharp increase in open interest in ETH futures positions, which could drive volatility quite a bit in the short term.
Ethereum technical analysis after the recent crash
The weekly ETH vs USDT chart has already been bearish for quite a while now. The fall of the last few hours did not have much impact on this panorama.
At the moment we continue to see the price above a large monthly support zone, around $ 2,000, where it seems quite feasible that at least a respite to the upside will begin.
The low reached at $1,735 was quickly rejected, so the vision of a possible rally is being fueled.
The current Ethereum scenario is not very encouraging for the short term. There are still no signs confirming that the bearish cycle has bottomed out. In case the selling pressure increases, we could see ETH looking for the next big demand zone, around $1,300.
However, the overall market picture tells us that the bottom could be close. Prices are reaching very important support levels, and every time the bearish force is quickly wrapped up.
Daily chart
From this time frame we can observe how Ethereum has quickly wrapped up much of the selling pressure seen today, which may be a good sign, if we consider that the price is over a relevant support zone.
In addition, ETH has remained locked in a small descending channel, while the RSI marks small lows higher and higher. This is a divergence of strength, which heralds a possible reversal in the near term.
However, a rebound from the current point should be large enough to be decisive. At the moment, it is possible that a respite is nothing more than a setback to continue in the search for the real bottom.
All our publications are of an informative nature, so in no case should they be regarded as investment advice.
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