Ethereum is currently trading back below $3,100 after a grueling overnight sell-off across the entire cryptocurrency market.
The sector’s second-largest asset has had a fruitful month of price action, rising from $1,700 in July to a monthly high of $3,390 in August.
However, the tide appears to have turned in the near term with Ethereum failing to close a daily candle above $3,320 after a series of persistent attempts.
The key support levels remain at $3,000 and $2,880, although it should be noted that if Ethereum can pull some strength out of its current region, it could well have enough fuel to breach the monthly high given the number of short positions that can be squeezed.
Much of it will depend on the trajectory of Bitcoin, which is trading at $47,000 after another miserable stab at the psychological level of resistance at $50,000.
If Bitcoin can break $50,000 with convincing volume, it would indicate a clear change in behavior, reinforcing the theory that a “double bubble” scenario could come into play as it did in 2013.
This pattern was established in 2013 when the Bitcoin bull market formed two major highs before entering an inevitable bear market.
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Ethereum was launched by Vitalik Buterin on July 30, 2015. He was a researcher and programmer working on Bitcoin Magazine and he initially wrote a white paper in 2013 describing Ethereum.
Buterin had suggested that Bitcoin needed a scripting language. He decided to develop a new platform with a more general scripting language when he couldn’t get support for his proposal.
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