Ethereum Classic flies on the back of bigger brother ETH

Ethereum Classic (ETC) price action printed a staggering 22% uptick on Monday as ETC price got a lift from its bigger brother ETH price, as all Ethereum-derived currencies enjoyed a boost in morale ahead of the network upgrade tonight. The stakes are high for ETH to get this right, as previous examples from other cryptocurrencies like Bitcoin show it can turn into a PR nightmare,  with a subsequent price implosion. Although this is not forecast for this evening, traders still need to pay close attention, as the correlation with global markets could find its limit and possibly reverse once high technical levels are hit.

ETC price could still offer 17% up for grabs

Ethereum Classic shot higher as a massive tailwind from Ethereum lifted all affiliated crypto coins and created an overall turnaround near the end of the closing bell late last night. As the US market was closed, volumes were thin, stretching out the rallies that occurred. Some more gains are up for grabs, though traders must bear in mind that current market events are still overall negative, and thus the medium to long-term positioning should still be to the downside. 

ETC price is currently undergoing a fade against the monthly R1 at $42.00, with a small step back as bulls cash in on that 22% gain from Monday. In case the return of the US to the markets could add some more volume to the rally, expect to see a break above the R1 and for the next target to be either $45.50, the low of July 27th, 2021 or in best case $48.33. That still means roughly 17% of gains are up for grabs, as bears will start to build up short positions around those areas.

ETC/USD Daily chart

Alternatively, the fade that is currently taking place against the monthly R1 resistance level could extend. If so, bulls would not be able to jump back in the price action straight away, having to instead wait for either a drop back to $36 and the monthly pivot for an entry, or, in the worst case, $32.90, which intersects with the 55-day Simple Moving Average and looks to be the most solid entry level for a long while. Unfortunately, that would also mean that all  gains of the rally will have evaporated.