Ethereum is still closely mirroring the price of bitcoin through the bear market and that has seen its price basically stall in the last day in tandem with BTC. ETH’s price is presently resting just above $1,200, and while this would have served as a good bounce-off point for the digital asset, it shows no signs of doing so.
Ethereum Price Stuck At $1,200
Given the current market circumstances, Ethereum at $1,200 presents one of the best prices that the market will see for the digital asset before 2022 runs out. The momentum in the market was already on a decline but the 49% jump in Ethereum’s trading volume in the last day put a perhaps temporary stop to that decline. Short-term indicators pointing towards sell points to this being temporary.
Now, for the lull in price, it can be explained by ETH’s price sitting so close to the 20-day moving average of $1,247. Since there isn’t much movement in the market, it makes sense that the digital asset would only try to maintain its price at just above $1,200 at this time.
Bitcoin’s tight correlation to the stock market has also impacted Ethereum. Although cryptocurrencies did not fall like the stock market following the release of the US GDP data on Thursday, it definitely hindered any growth from taking place in the market.
ETH price struggling at $1,200 | Source: ETHUSD on TradingView.com
Why Is ETH Struggling?
Ethereum has received some bad press over the last couple of days. One of the most prominent was when the Paxful peer-to-peer exchange announced that it was delisting Ethereum. CEO Ray Youssef presented the reason as “Integrity over revenue” as the exchange believes that the network was not decentralized.
This stoked fears that had previously subsided following the move to proof of stake. For many, this move made Ethereum much easier to control and Youssef said, “One day you will need permission to use it.”
Given this, the price of ETH has buckled under the pressure of the FUD it created. If bulls are unable to hold the $1,200 support, then it could send the digital asset into free fall, with no significant support until $1,140. The cryptocurrency is already headed for a close below its year-to-date peak but a close below $1,200 would see it start the new year with a very bearish outlook.
ETH is trading at $1,224 at the time of this writing, according to data from Coinmarketcap. It is up 0.64% in the last 24 hours and boasts a market cap of $149.8 billion.
Featured image from Ledger Insights, chart from TradingView.com
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