Megaphone Pattern Governs The Ethereum’s Ongoing Price Action; Is $2000 In Reach?
The formation of a megaphone pattern in the daily time frame chart shows the Ethereum price is in a state of high volatility and uncertainty among the market participants. Furthermore, the ETH price’s recent reversal from the rising trendline triggered a near-bear cycle /correction phase, which could tumble its price below the $1500 support. Here’s how you may trade this pattern.
Key Points:
- A megaphone pattern prolongs a sideways trend in Ethereum price.
- Under the influence of the Megaphone pattern, the Eth price could witness a 9-10 % downfall.
- The intraday trading volume in Ether is $5.4 billion, indicating a 10% loss.
Source- Tradingview
Amid the increasing bearishness in the crypto market, the Ethereum price lost 6.75% in six days and tumbled to the current price of $1605. This ongoing bear cycle within the megaphone pattern is likely to cause a downfall below the $1500 support to reach the lower support trendline.
However, the lower price rejection candles showcased in the recent price drop indicate that buyers are trying to reclaim the trend control. Thus, if the selling pressure in the market persists, the coin price will rise slightly higher to retest the 20-day EMA or $1660 before continuing the ongoing correction phase.
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However, for the Ethereum price to escape a sideways trend, it must breach the trendlines of the megaphone pattern.
As the prior trend before the ongoing consolidation was bullish, the Ethereum price is more likely to break the overhead trendline and resume that rally.
This potential breakout may push the coin price to the $2000 mark.
Technical Indicator
Bollinger Band: The falling Ethereum price plunged below the indicator’s midline, reflecting an additional confirmation for potential downfall.
MACD: a slow but gradual spread between the MACD(Blue) and the signal(orange) line indicates the increasing bearish momentum in the market.
Ethereum Coin Price Intraday Levels-
- Spot rate: $1600
- Trend: Slightly Bullish
- Volatility: High
- Resistance level- $1680 and $1788
- Support level- $1500 and $1420
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