Ethereum’s bullish trend halted after it reached the key resistance at $1.7K. The price action looks volatile, while a short-term correction is what many would expect.
Technical Analysis
past Cheyenne
daily chart
Ethereum has crossed the 200-day moving average and the upper trend line of the multi-month channel due to the recent bullish development of the entire market. However, the price has fallen from the key resistance level at $1.7K and is now consolidating below it.
On the other hand, there is a significant bearish divergence between the price and the RSI on the daily time frame. This may lead to fluctuations in the coming days.
However, there are three critical stable levels for Ethereum on the daily chart; The major resistance level is at $1.7000, the minor support level is at $1.3000 and the major support level is at $1,000.
The price has been fluctuating between $1,000 and $1.7000 for several months, and the minor support level at $1.3000 is likely to be Ethereum’s next stop in case of rejection from $1.7000.
4 hour chart
Ethereum price action appears to be bearish in the four-hour period as it formed a bullish head and shoulder pattern, also known as the Three-Driver pattern, which is a reversal pattern popular in classic price action, after reaching a major resistance area.
If the cryptocurrency breaks below the neckline, around $1.5000, the market should expect a short-term decline towards the minor support level at $1.3000. Given the current price action and the above mentioned bearish signs, it is likely that Ethereum will go through a consolidation correction period before the next impulsive move.
String analysis
past Cheyenne
The following chart shows the 14-day RSI to measure open interest with the price of Ethereum. After the recent rally in the Bitcoin price over the past two weeks, ETH has also recorded an uptick, which indicates that there is demand in the market.
As a result, futures market activity has also increased over the past week, which has led to an upward trend in open interest on Ethereum. Usually, when the RSI for Open Interest reaches the red area (above 70), the probability of a short-term correction increases.
Currently, the scales have risen and are close to entering the red. Thus, a short-term decline can drain high-leverage long positions. This structure highlights the risks to the futures market in the short term.
Here post is First Support for ETH in Short-Term Correction (Ethereum Price Analysis) appeared first on CryptoPotato.