Can This Upcoming Trendline Prevent Further Downfall In Ethereum Price?
The daily ETH/USDT technical chart shows the formation of a cup and handle pattern. In response to this pattern, the coin price should follow an uptrend direction and break the neckline resistance of $2000. By doing so, the Ethereum price would obtain an early signal for trend reversal which could grab the first target of $2500. However, the coin price currently trades at $1575 and 8% down on the intraday level.
Key points from Ethereum price analysis:
- The Ethereum price has lost 11% in the last three days.
- An upcoming support trendline may assist buying to maintain a recovery rally.
- The intraday trading volume in Ethereum is $22.5 Billion, indicating an insignificant rise of 22.8%.
Source- Tradingview
Today’s sell-off initiated with the fresh data consumer price index(CPI), pointing to an 8.3% YoY inflation. However, the bearish momentum accelerated as the CME Fed Watch Tool showed a 20% chance of a 100 bps or 1% interest rate hike. Thus, the market sentiment is again in turmoil, and questioning has the bottom really formed.
Anyhow, the technical chart currently shows a bullish reversal pattern governing the Ethereum price action, and therefore, traders can keep a bullish outlook until they don’t lose the swing low support of $1430.
As of now, the bearish engulfing candle retests the combined support of $1550 and the upcoming support trendline. However, if today’s daily candle closes above this support, the price holds a recovery opportunity.
A possible reversal from this concentrated support will surge the altcoin 28% higher to hit the neckline of the aforementioned pattern.
On a contrary note, if the selling pressure persists and the daily candle closes below $1550, the price will fall to $1430 and attempt to breach it
Technical indicator-
MACD indicator: the fast and slow lines wavering exactly over the mid-zone indicates a neutral sentiment among the market participants.
EMAs: it seems the EMAs have marked the crucial level of technical chart offering weightage to those levels. Thus, the 20-day EMA at $1550 support assists buying to sustain the bullish pattern. Moreover, the 200-day EMA at $2000 resistance creates an additional barrier against bulls.
- Resistance level- $1785 and $2000
- Support level- $1550 and $1430
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