Ethereum Classic struggles to maintain its 1% gains for the trading day

  • Ethereum Classic tries to trade above $28 but comes under pressure from profit taking. 
  • ETC price could face continued headwinds as  traders pull out.
  • Despite holding more upside potential, expect difficulties as major pairs rally higher while altcoins lag behind.

Ethereum Classic (ETC) price is still seeing positive numbers on Tuesday – for the second day in a row – and arguing for a positive return for the week. That is as far as the good news goes, as bigger currency pairs such as EUR/USD or GBP/USD are rallying on the back of  a wave of risk-on alongside equities, whilst traders have sidelined alt-currencies like ETC, and are only looking for an easy profit in very liquid and common assets.

ETC price holds small gains with big ifs

Ethereum Classic price is shy of printing 3% of gains for this trading week as a second profitable day is evolving towards the US close. Gains are limited compared to mainstream assets. . This could well be because traders are focused on liquid assets in order to make it much easier for them to move out again once the tide turns back to risk-off.

ETC is a less known derivative and is less liquid compared to trading futures in equities, the eurodollar or cable. Expect ETC price to fade under some profit-taking as traders in the rally start to get the narrative. The risk could be that the fade broadens and turns into a small drop back to the opening price from Monday, at around $26.56, as price action gets underpinned by $26.

ETC/USD Daily chart

Risk to the downside could come from the earlier mentioned fade turning into a sell-off and revisiting $26. Either that or the rally could get another stretch higher but would undergo a firm rejection against the 200-day Simple Moving Average (SMA) around $30 and next see a deepened fall below $26 – possibly then tanking to $22, with the monthly S1 and the low of mid-August coming into play. Either way, any upside potential will be met with heavy selling from bears trying to get in for the next leg lower.