Forex Analysis & Reviews: 03.02.2023 - Technical Analysis of...

03.02.2023 10:17 AM

Technical Analysis of ETH/USD for February 3, 2023

Crypto Industry News:

Berkshire Hathaway (BRK) Vice Chairman and staunch skeptic of the crypto market, Charlie Munger, has called on the US to follow China's lead and ban cryptocurrencies altogether. In an opinion the billionaire expressed to a widely read financial journal, Munger claimed that the growth of cryptocurrencies was due to a loophole because crypto assets are not currencies, commodities or securities. In addition, he said this: "Instead, this is a nearly 100% house edge gambling deal made in a country where gambling deals are traditionally regulated only by states that loosely compete with each other." He further added: "The United States should now pass a new federal law to prevent this from happening."

This is not the first critical statement by the vice-president of BRK towards the crypto industry.

In 2021, Charlie Munger described Bitcoin's success at the time as "disgusting", after referring to how it is being used by criminals, scammers and hackers. We have recently prepared a report about these third parties, in which we summarize their activities in the crypto industry in the last year - we strongly encourage you to read it. A year later, the 99-year-old called BTC an "investment in nothing," reaffirming his skeptical stance on the "new digital gold." Munger even went so far as to say that he wished cryptocurrencies had "never been invented." But perhaps that was what Satoshi Nakamoto had in mind.

Technical Market Outlook:

After the fake breakout from the Triangle price pattern on the H4 time frame chart and a new local high at the level of $1,695 the ETH/USD pair reversed sharply lower. The Bearish Engulfing candlestick pattern was made at the H4 time frame chart yesterday, so the outlook remains bearish now. The nearest technical support is seen at $1,525 and $1,487. The key technical support is located at $1,350 and only clear and sustained breakout below this level would change the short-term outlook to bearish. Please keep an eye on the $1,487 technical support as any violation of this level would likely extend the drop towards $1,345, but in order to do this, the volatility must increase significantly. The next target for bulls is seen at the level of $1,788 (September 2022 high).

Weekly Pivot Points:

WR3 - $1,834

WR2 - $1,702

WR1 - $1,628

Weekly Pivot - $1,570

WS1 - $1,496

WS2 - $1,438

WS3 - $1,307

Trading Outlook:

The Ethereum market has been seen making lower highs and lower low since the swing high was made in the middle of the August 2022 at the level of $2,029. The key technical support for bulls at $1,281 was broken already and the new swing low was established at $1,074. There is a clear test of the 50 WMA located at the level of $1,080, so any breakout below the moving average and a weekly candle close below moving average will be considered as another indication of the down trend continuation. If the down move will be extended, then the next target for bears is located at the level of $1,000.

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