- Ethereum is on the cusp of a breakdown to $520 after losing support above $600.
- Ether bulls must defend the support at the ascending parallel channel’s lower boundary to avert the brewing losses.
Ethereum was blasted to new yearly highs above $600 earlier this week. The majestic move shined a light on the altcoin season finally catching up with Bitcoin as it rallied above $19,000. Ether achieved a new yearly high at $623 before retreating below $600. Meanwhile, the bearish pressure seems to be building as havoc brews in the market.
Ethereum impeding breakdown eyes $520
At the time of writing, ETH is trading at $595 after falling under the ascending parallel channels’ middle boundary. The bearish outlook also seems to be gaining traction, especially after the Relative Strength Index has plunged from the overbought region.
Ethereum is required to hold above the channel’s lower boundary support to avert further losses and perhaps renew the uptrend above $600. Trading under this critical level might trigger a surge in sell orders, creating enough volume to force the price below other vital levels, including $560.
ETH/USD daily chart
On the downside, formidable support would be provided by the 50 Simple Moving Average (SMA) in the 4-hour timeframe. The volume seems to be expanding already, as the price continues to fall.
It is worth mentioning that buyers can avoid the losses to $520 if they can defend the channel’s lower boundary support. Besides, closing the day above the middle boundary or $600 might renew the bullish outlook and place ETH/USD on a pathway to new yearly highs, preferably near $700.
Ethereum intraday levels
Spot rate: $590
Relative change: -15
Percentage change: -2.5%