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Following the September second and third-week sell-off, the Ethereum price plummeted to $1230 support. Moreover, this downfall hitting a low level such as 0.786 Fibonacci retracement level weakens the possibility of price recovery. Furthermore, the coin chart showed the formation of an inverted pennant pattern increased the probability of a prolonged correction.
Key points:
- The Ethereum price has been trapped in a no-trading zone for the last two weeks.
- The $1230 breakdown will undermine the July-August recovery
- The intraday trading volume in Ethereum is $7.5 Billion, indicating a loss of 47%.
Source-Tradingview
The inverted pennant pattern is a continuation pattern that accelerates the ongoing bearish momentum. In theory, the pattern technical set-up offers a short break, where price resonates within two converging triangles resembling a symmetrical triangle.
Thus, the Ethereum price wavering between $1400 and $1230 can be considered a no-trading. Moreover, the high wick rejection on either side reflects high volatility in market sentiment. The coin price currently trades at $1323 and shows an intraday loss of 0.4%.
With sustained selling, the altcoin should retest the lower trendline for another breakdown attempt. A four-hour candle closing below the support trendline will trigger this pattern and a selling opportunity for traders.
Moreover, this breakdown will act as a catalyst to breach the aforementioned $1230 support. Thus, losing the $1230 support will intensify the selling pressure and open the path to the $1000 mark.
On a contrary note, if the buyers manage to break the pattern’s resistance trendline, a possible relief rally may drive the Ethereum price to $1550 resistance.
Technical indicator-
EMAs: the downsloping EMAs(20, 50, 100, and 200) indicate an established bear trend. Moreover, the 20-day EMA closing near coin price could assist sellers in resuming the ongoing downfall.
MACD indicator: despite the bearish crossover, the failure of MACD and signal line to give sufficient spread indicate traders are struggling to maintain sustained buying. Moreover, these slopes below the midline suggest the overall sentiment is bearish.
Ethereum intraday price levels
- Spot price: $1320
- Trend: Sideways
- Volatility: High
- Resistance level- $1400 and $1550
- Support level- $1230 and $100
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