Ethereum price analysis: Breaks below $700 again; the bears are not done yet while Norwegian Central Bank considers launching its own cryptocurrency

Ethereum price is trimming the gains it accrued during the trading session yesterday. The cryptocurrency exchanged hands above $720 but selling pressure intervened leading to lower corrections. Ethereum price butchered its way past key support zones at $710 and $700 respectively and at the moment it is testing another support level at $680.

Various central banks are considering launching their own cryptocurrencies including the Reserve Bank of India. Norges Bank, the Norwegian Central Bank has released a working group report on cryptocurrencies. The report includes an assessment of virtual currencies, however, it also lists the preliminary uses cases for the central bank digital currency (CBDC). Some of the use cases for the CBDC include “ensuring a public and crediting risk-free alternative to deposits in private banks, in addition to cash, functioning as an independent back-up solution for the ordinary electronic payment systems, and to ensure the existence of suitable legal tender as a supplement to cash.”

The top ten cryptocurrencies by market capitalization are in the red. Ethereum is down 1.67% on the day, although attempts to retrace past $690 have been met by bear pressure. Slightly above this level, more resistance is coming from the 38.2% Fib retracement level with the last swing high of $766 and a low $644. Indicators on the same chart signal increasing bear pressure in the short-term. The RSI is at the 40 mark while pointing south, but the gap between the moving averages is narrowing showing that ETH/USD could consolidate higher. An immediate support has been formed at $685, but $680 will continue to support the price as well. The major support at $660 is going play a vital role in stopping declines in the event of extended declines.

ETH/USD 1-hour chart