Crypto Market Review, October 31

Ethereum was mostly the reason behind the recent rise in the cryptocurrency market as the second largest cryptocurrency rushed to the local resistance and broke it. Despite the loss of momentum, the continuation of the rally is still possible.

$1800 is the next destination

While Ether has yet to reach the next psychological level of $1,700, the real resistance for the second largest digital asset in the world is slightly higher from a technical perspective. $1700 will most likely be breached relatively quickly if Ether gains momentum in the market, but $1800 is a different story.

According to the daily chart of ETH, bulls have formed a solid resistance at $1,775, which is confirmed by the order book across exchanges. There are two reasons behind it: the 200-day moving average and the historical resistance level that formed after Ether broke down from $1,780 and lost almost 20% of its value in a few days.

The points of big and strong breakdowns usually turn into resistance levels as investors tend to actively sell assets to break even. As this process repeats, consolidation channels form and cause long-lasting consolidations. Once traders have disposed of most of their funds, another breakout becomes a matter of time.

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For now, Ethereum is moving sideways due to lack of volume in the market. The most likely reason behind the lack of momentum may be related to increased fear among investors caused by Ethereum’s oversold nature.

But even a small correction or consolidation will cause the RSI to return to the normal zone, which will be a signal for investors and traders to re-enter the market.

Dogecoin needs it to continue

Memecoin’s 140% rekindled interest in risky assets again. However, it wasn’t easy to keep up the pace we saw on DOGE from the beginning, and the main thing memecoin needs right now is a correction.

The continuation of the rally will certainly lead to even more retail inflows into the coin, which is a negative factor for assets going through a volatile rally. When the first correction happens, the market will not be able to cover the existing selling pressure and Dogecoin will meet the fate of assets like the Shiba Inu.

However, a timely correction will allow the memecoin to cool down and then continue upwards. During the last rally in April 2021, Doge lost almost 70% of its value after the first correction after the pump, but managed to climb even further since the reversal that allowed DOGE to cool down appeared a few days after the first pump.

At press time, Dogecoin is trading at $0.12 with a price increase of 3.4% in the last 24 hours, but considering the volatility, the situation in the market can change drastically within a few hours.