TA: Ethereum Signals Recovery, How ETH Could Start A Strong Increase

Aayush Jindal

1 year ago

2 mins read

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Ethereum extended its decline and it traded close to $2,300 against the US Dollar. ETH price is now recovering and it could start a strong increase if it clears $2,550.

Ethereum extended its decline below the $2,400 and $2,300 support levels.
The price is now well below $2,600 and the 100 hourly simple moving average.
There is a major bearish trend line forming with resistance near $2,480 on the hourly chart of ETH/USD (data feed via Kraken).
The pair is likely forming an inverse head and shoulders pattern with resistance near $2,550.

Ethereum Price Could Rise Steadily

Ethereum failed to stay above the key $2,550 support level, and it extended its decline. ETH traded below the $2,440 and USD 2,400 support levels.

It even broke $2,350 level and settled well below the 100 hourly simple moving average. A low is formed near $2,313 and the price is now correcting higher. It broke the $2,400 resistance level. Ether also climbed above the 23.6% Fib retracement level of the of the recent drop from the $2,850 swing high to $2,313 low.

However, the price is now facing a strong resistance near $2,500. There is also a major bearish trend line forming with resistance near $2,480 on the hourly chart of ETH/USD.

Source: ETHUSD on TradingView.com

It seems like ether is likely forming an inverse head and shoulders pattern with resistance near $2,550. The 50% Fib retracement level of the of the recent drop from the $2,850 swing high to $2,313 low is also near the $2,580 level.

If there is a clear break above the trend line and a follow up move above $2,550, the price could start a strong increase in the near term. The next major resistance could be $2,640.

More Losses in ETH?

If Ethereum fails to clear the $2,500 and $2,550 resistance levels, it could extend its decline. An initial support on the downside is near the $2,400 level.

The first major support is near the $2,350 level. A downside break below $2,350 and the recent low could accelerate losses. The next major support is near the $2,220 level or $2,200.

Technical Indicators

Hourly MACD – The MACD for ETH/USD is slowly gaining pace in the bullish zone.

Hourly RSI – The RSI for ETH/USD is currently approaching the 50 level.

Major Support Level – $2,350

Major Resistance Level – $2,550

Aayush Jindal

Aayush Jindal, a luminary in the world of financial markets, whose expertise spans over 15 illustrious years in the realms of Forex and cryptocurrency trading. Renowned for his unparalleled proficiency in providing technical analysis, Aayush is a trusted advisor and senior market expert to investors worldwide, guiding them through the intricate landscapes of modern finance with his keen insights and astute chart analysis.

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