The upcoming Merge on Ethereum is bringing a lot of volatility to the cryptocurrency market, creating many opportunities you can use to profit. Let’s break down a market outlook on three cryptocurrencies you should have on your watchlist.
Ethereum (ETH) outlook
Ethereum’s transition from Proof-of-Work (PoW) to Proof-of-Stake (PoS) is coming in a few days and brings a lot of traction to ETH, which brings the price of the cryptocurrency higher. While many investors are starting to stake ETH to earn staking rewards in the future, they should also consider this event to be a FOMO (fear of missing out). While this merge is a historic event, the crypto market is still in a strong downtrend, and there is no reason to be bullish in the short term.
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Ethereum still needs to break the trend line in the chart that keeps the cryptocurrency in a downtrend, which is less likely to happen. Strong resistance, trend line, moving average (EMA200), and divergence suggest the downtrend could continue in the near future. If ETH breaks the trend line, that would be a solid reason to be bullish, but until that happens, the market is bearish. If Ethereum bounces back down, a retest of support at around $860 is possible.
Ethereum daily chart, source: tradingview.com
Cardano (ADA) outlook
After Cardano made an all-time high (ATH) above $3, it went straight down by almost 90%, creating a solid investment opportunity for long-term investors. For those who did not buy Cardano yet, there could be another buy signal when ADA retests the important support of $0.36. If Cardano retests the ATH level of $3, this offers at least 10x potential for your capital in the next few years. And even if not, ADA has the potential to go at least $1.3.
Cardano weekly chart, source: tradingview.com
Ethereum Classic (ETC) outlook
Ethereum Classic is receiving a lot of attention as Ethereum because miners are looking at new opportunities. It won’t be possible to mine Ethereum anymore, so miners might be interested in mining Ethereum Classic, which caused the astonishing price increase from just $13 to around $45. However, is ETC the right crypto to put your money in as an investor?
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Investors should be aware that more than 300% move upward could be a FOMO, and ETC might be headed lower soon. The cryptocurrency is moving in a descending channel, and it is currently testing its upper trend line. The market is not bullish until this channel is broken, so it could actually be a good zone to enter a short position, but be aware it’s riskier than buy position. The best possible entry would be if ETC retested the support at $13 or created a higher low a little above $13.
Ethereum Classic weekly chart, source: tradingview.com
Bottom line
Although markets are very undervalued right now, the bearish sentiment remains, and it could continue for a few more months as banks fight inflation and raise interest rates. It is expected the markets will continue to struggle for a few more months, and when the economy starts to get better, it will be the best time to accumulate risk-on assets like cryptos and stocks.
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