Ethereum price meets imminent barrier above $1,200 as massive correction lingers

John Isige Altcoin News PublishedJanuary 15, 2021 | ModifiedJanuary 15, 2021

ETC-WETC-DAI-DeFi

Ethereum price meets imminent barrier above $1,200 as massive correction lingers

  • Ethereum recovers tremendously following a recent breakdown to $900, prices rise above $1,200.
  • ETH/USD is dancing in the confines of a rising wedge pattern; a correction seems imminent in the near-term.

Ethereum has recovered considerably after falling to $900 earlier in the week. The price action was lock-step at first, mostly due to the resistance at $1,100. However, Ether managed to overcome the hurdle, leaving an open-air for exploration. On hitting levels above $1,200, ETH’s uptrend appears to be grinding to a halt and might give way to a pullback if a chart pattern is confirmed.

Ethereum draws closer to a rising wedge pattern breakdown

The largest altcoin is also trading at the apex of an ascending wedge pattern, suggesting that a reversal is in the offing.

The bearish outlook forms when an asset’s price ascends with pivot highs and lows while converging at a single point referred to as the apex. A breakdown usually occurs before the trendlines converge.

The typical breakdown is mostly confirmed by decreasing volume (highlighting a divergence between volume and price). Breakdowns are generally fast and drastic, thus need to be spotted precisely for them to be profitable.

ETH/USD 4-hour chart

ETH/USD chart by TradingView

Similarly, if Ethereum fails to hold above $1,200 losses might still come into the picture. Additionally, the 50 Simple Moving Average on the 4-hour chart must be defended at all costs to ensure that massive declines are kept at bay.

Nonetheless, it is worth noting that Ethereum will sustain the ongoing momentum if support above $1,200 is kept intact. The wedge pattern also needs to be ignored mainly by bulls focusing on the next crucial hurdle at $1,300. Price action beyond this level could see ETH/USD rally to $1,400.

Ethereum intraday levels

Spot rate: $1,225

Relative change: -6

Percentage change: -0.5%

Trend: Bullish

Volatility: Low

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