Ethereum [ETH] & EOS Price Action – Quick Crashes and Recoveries For Both
The price action of the native cryptocurrencies of decentralized computing platforms EOS and Ethereum have both been looking bearish as they both undergo sharp drops earlier today.
Both drops have managed to recover but the drops indicate that there is more selling pressure in the market for these cryptocurrencies.
Both have also been consolidating for the past few days representing high amounts of trader uncertainty.
Ethereum is forming a Dragonfly Doji candle for today’s daily candle and the prior to candles closed with small bodies.
A Dragonfly Doji candle is a candle where the open, close, and high are all around the same point while there is a long lower wick to represent a sharp sell-off earlier in the day.
A Dragonfly Doji candle can be bullish when it forms during a downtrend as it shows buyers rejecting lower valuations.
However, when it forms after price action similar to what Ethereum has been recording, it is more bearish as it shows more selling pressure starting to arrive in the market.
The hourly chart shows that the price drop which took place earlier in the day quickly recovered.
The price has been consolidating below resistance at $139.10 which has acted as resistance several times.
EOS has also been forming a Dragonfly Doji candle on the daily chart after its crash and subsequent recovery in earlier intraday price action.
The previous two candles formed on the daily chart for EOS were also Doji candles showing high amounts of uncertainty from traders.
Ther earlier price crash brought the price below a support level at $3.67 which it had tested numerous times already this week.
Numerous tests of a support level make the level weaker with progressively fewer buyers to hold the level on each test.
It is likely that price will fall back below the level again with the Dragonfly Doji indicating that there is increased amounts of selling pressure back in the market.
- Both EOS and Ethereum crash and quickly recover in earlier intraday price action.
- Both are forming a Dragonfly Doji on the daily candle indicating higher amounts of selling pressure.
- The Dragonfly Doji candles forming are bearish signs after the period of consolidation that both of the price action of both of these cryptocurrencies have been recording.
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