After proving their dominance in the second half of July, Ethereum Classic (ETC) bulls are starting to lose grip on momentum.
ETC retraced below £32.7 after reaching a peak just above £36.8.
Given the solid rally that ETC experienced around the end of July, a big pullback was unavoidable.
At the start of August, there was selling pressure as a result of it. While the price dropped as low as £26.3 on August 2 as, there was a rebound close to the 0.5 Fibonacci retracement line.
Another sign of bullish weakness is the altcoin’s struggle to maintain above the 0.618 Fibonacci barrier. The bears might eventually prevail in this situation. A few signs already point in that direction.
The Relative Strength Index (RSI) has already dramatically retraced below the overbought zone. It fell below the 14-day SMA on August 10, indicating that the trend inclined towards the bears.
The RSI and MACD are working together to observe the increasing selling volume. The latter has crossed below its signal line. The 26-day EMA is in inversion beneath the 9-day EMA.
These indicators suggest that there is a strong chance that there will be a prolonged bearish retracement in the coming days.
On-chain metrics seem to support this narrative in several ways.
For instance, over the past two days, ETC’s social dominance has considerably decreased.
According to the percentage rise in stablecoin supply since August 3, whales that held more than £4.9 million worth of the asset may have reduced their holdings.
There is also hope for a modest downside.
The metric for weighted sentiment was -0.51 at the time of writing, which indicated that it was low enough to support increased buying pressure.
Furthermore, this week has seen a lot of development activity at ETC. This could encourage ETC coin holders to keep their coins or increase buying pressure.