New Bearish Pattern Puts Ethereum Price Under Correction Threat

After an explosive rally in January, the Ethereum price went sideways below the $1680 resistance. Originally this lateral walk was meant to neutralize the aggressive buying and replenish the bullish momentum. However, amid the uncertainty in the crypto market, the ETH price witnessed a prolonged consolidation and recently revealed a bearish pattern formation called the rising wedge. 

Key Points:

• A potential breakdown wedge pattern will set the Ethereum price for an 8% drop.
• A daily candle closing above the overhead trendline will undermine the bearish thesis.
• The intraday trading volume in Ether is $6.7 Billion, indicating a 3.7% loss.

Source- Tradingview

Over the past three weeks, the Ethereum coin price has been resonating in a rising wedge pattern. As the prices continue to move up within the pattern’s converging trend lines, the distance between the highs and lows of the price action decreases, indicating a loss of momentum in the uptrend. 

Under the influence of this pattern, the prices are more likely to break below the lower trendline, which will confirm a bearish reversal and signal a potential sell opportunity for traders and investors. As of now, the ETH price trades at $1637, with an intraday gain of 1.45%.

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Thus, a daily candle closing below the pattern’s support trendline will intensify the selling momentum and prepare the Ethereum coin for further downfall. This potential correction may plunge the 8% down to retest the $1500 psychological support.

Anyhow, this support is crucial for coin holders, as a breakdown below it will weaken the possibility for ETH buyers to resume price recovery.

Technical Indicator

RSI: the falling daily-RSI slope reflects the exhaustion of bullish momentum and encourages the aforementioned correction

EMAs:  during a potential downfall, the rising EMAs could assist buyers in sustaining higher prices.

Ethereum Coin Price Intraday Levels-

• Spot rate: $1632
• Trend: Bullish
• Volatility: Medium
• Resistance level- $1680 and $1800
• Support level- $1500 and $1370