On June 3, Ethereum Classic hit a yearly high of $9.85. The move followed a nearly 200 percent upswing that began in early December 2018 when it was trading at $3.30. Many investors took this peak as a profit point, causing ETC to then plummet 49 percent, hitting a low of $5.03 on July 16.
Since then, this cryptocurrency entered a consolidation phase and traded between $6.50 and $5.50. This trading range was seen as a no-trade zone by many traders due to the uncertainty of the trend.
As the consolidation period developed, the Bollinger bands on the 12-hour chart squeezed. Squeezes are indicative of periods of low volatility and are typically followed by periods of high volatility. The longer the squeeze the higher the probability of a strong breakout.
After more than a month, the outlook predicted by the squeeze manifested itself in an impressive break out. The spike in volume was significant enough to push ETC up 40 percent in three days.
At the moment, it seems like ETC took a break from the recent upswing as it prepares for its next move.
ETC/USD by TradingView
By measuring the Fibonacci retracement indicator from the low of $3.30 on Dec. 7, 2018 to the high of $9.85 on June 3, one can identify a series of support and resistance levels.
Ethereum Classic is currently testing the resistance given by the 38.2 percent Fibonnaci retracement level that sits at $7.35. Breaking above this level may allow ETC to continue appreciating and test the next level of resistance,