TA: Ethereum Recovers Losses, Why Bulls Face Major Challenge
Ethereum stayed above the $2,550 support zone against the US Dollar. ETH price is rising, but it must clear $2,700 for a sustained move higher
Ethereum found support near $2,580 after a downside correction from $2,800.
The price is now trading above $2,650 and the 100 hourly simple moving average.
There was a break above a key bearish trend line with resistance near $2,640 on the hourly chart of ETH/USD (data feed via Kraken).
The pair could start a strong increase if there is a clear move above the $2,700 resistance.
Ethereum Price Revisit $2,700
Ethereum started a downside correction from the $2,800 resistance zone. ETH traded below the $2,750 support level and even declined below $2,700.
The price even spiked below the $2,600 level, but the bulls remained active above $2,500. A low was formed near $2,577 and the price is now rising. There was a recovery wave above the $2,600 and $2,620 resistance levels.
Ether climbed above the 23.6% Fib retracement level of the downward move from the $2,819 swing high to $2,577 low. Besides, there was a break above a key bearish trend line with resistance near $2,640 on the hourly chart of ETH/USD.
The pair is now trading above $2,650 and the 100 hourly simple moving average. An immediate resistance on the upside is near the $2,700 level. It is near the 50% Fib retracement level of the downward move from the $2,819 swing high to $2,577 low.
Source: ETHUSD on TradingView.com
A clear move above the $2,700 resistance could stage a strong upward move. The next key resistance is near the $2,800 level, above which ether price might accelerate higher towards the $3,000 resistance zone in the near term.
Fresh Decline in ETH?
If ethereum fails to start a fresh increase above the $2,700 resistance, it could start another decline. An initial support on the downside is near the $2,660 level and the 100 hourly SMA.
A downside break below the 100 hourly SMA might put pressure on the bulls. The next major support is near the $2,600 level, below which there is a risk of a sharp decline. In the stated case, the price might dive towards the $2,500 level or $2,480.
Hourly MACD – The MACD for ETH/USD is losing pace in the bullish zone.
Hourly RSI – The RSI for ETH/USD is now above the 50 level.
Major Support Level – $2,600
Major Resistance Level – $2,700