Ethereum price weekly analysis 12 June: Two big dips strip 12% from ETH
Ethereum follows the market and takes a hammering.
- Ethereum drops about 12% in a couple of large falls.
- The coin's founder says the network is suffering from limited capacity.
- We might not have hit the bottom of the price fall yet.
Like most of the market, the last week has not been kind to Ethereum. After sitting reasonably steady through last week, after some solid gains the week before, things took a downward slide on the back of two large falls on Sunday and Monday mornings.
Before the first dip, ETH was trading at a touch under US$600, just below the $616 peak of the last seven days. The first dip was a loss of $20 but the second wiped another $50 from the price, representing a fall of around 12%. The price has staged a small recovery to sit at around $535.
Volumes were flat during that period but picked up later, presumably as traders decided the price was low enough to warrant some increased buying activity.
It's been a couple of weeks since we've seen Ethereum trade at levels this low. Back in late May, the price hit $512, the same level we saw when things bottomed out yesterday. That price was the nadir after a strong period that saw the price reach the mid-$700s. After that fall, the price recovered to around $620 before the last week or so saw a lot of that value stripped away.
The $520 level seems to be critical, at least according to FXStreet. It's saying that if the price drops below the $520 support level that $485 is the next stop on the ETH train.
Two other developments are also being linked to the price fall according to NewsBTC. It says the total coin supply for ETH changing to 100 million and comments made by the coin's founder Vitalik Buterin pointing to limited capacity within the Ethereum network might have spooked the market. It adds that sell-offs such as the one we're seeing are often seen after periods of rapid gains. The view is that $350 is a possibility.
Disclosure: At the time of writing, the author holds BTC, EOS, ETH, XLM, ETN, LTC, ADA and XRP.