Ethereum price analysis – Temporary downwards price correction

Ethereum price soared up to a day high of $712 on Tuesday before a downwards price correction attempt became evident pulling the price downwards to a day low of $596 on Wednesday. The market bulls failed to break through the resistance around $713.24, which corresponds to the 61.8% Fibonacci retracement. The upwards trend which has been evident since April 7th, bounced off this crucial resistance level. The price correction attempt is subsiding as ethereum price rose again above $600 during most of Wednesday’s trading sessions.

Will ethereum price continue on dropping on Thursday? or shall we expect the market bulls to take the upper hand again?

Bouncing off the 61.8% Fib. retracement on the 4 hour ETHUSD chart:

We will examine the 4 hour ETHUSD chart from Bitfinex, while plotting the 100 period SMA, the 200 period SMA, and the Ichimoku Cloud as shown on the below chart.  We will keep the Fibonacci retracements  we extended last week

  between the low recorded on October 23rd, 2017 ($273.50), and the high recorded on January 13th, 2018 ($1,424.06). We can observe the following:

  • Ethereum price soared steadily on Tuesday to a day high of $712, before the bullish wave was reversed. The price of ether was almost a dollar short of $713.24, the 61.8% Fib. retracement (horizontal orange line on the above chart). Note that six successive bullish (green) candlesticks were formed just before the uptrend was reversed. As such, even though the bullish momentum was seemingly strong, it failed to breach this resistance level.

 

  • Ethereum price is now above the level of the 100 period SMA, and the 200 period SMA. Note that the 200 period SMA (green curve) is now acting as a support level preventing further price drop, as evidenced by the long downwards shadows of candlesticks near its level. Therefore, the price of ether will most probably start rising again as the $600 price level will prevent further price drop. However, we have to see the 100 period SMA (green curve) cross above the 200 period SMA, before a strong bullish wave becomes evident again.

 

  • Right now, ethereum price is being supported by the confluence of three important support levels:
  1.  the 200 period SMA as we stated above.
  2. the upwards trend line that has been marking price movement since April 7th.
  3. the Leading Span A Line (green line) of Ichimoku’s Cloud

Consequently, we can expect ethereum price to rise again towards $713.24 during the next 24-48 hours. On the downside, $600 represents the support level as we explained.

  • Ethereum price has dropped below the Base Line (red line) of Ichimoku’s Cloud, yet the cloud is still green (bullish) in color. Most likely, candlesticks will rise again above the Base Line within less than 48 hours as the bullish momentum rises.

Bullish alignment of the smoothed moving averages on the 1 hour ETHUSD:

Now, let’s examine the 1 hour ETHUSD chart from Bitfinex, while plotting the 50 period SMA (blue curve), the 100 period SMA (green curve), and the 200 period SMA (red curve), as shown on the below chart. We can note the following:

Related Post

 

  • After failing to breach the resistance around the 61.8% Fib. retracement ($713.24), the price of ether dipped below the level of 50 period SMA, yet the 100 period SMA is acting as a relatively strong support level preventing further price drop. This is evidenced by the relatively long downwards shadows of candlesticks near the level of this moving average.

 

  • The alignment of the SMAs is bullish, as the 50 period SMA is on top, the 100 period SMA is in the middle, and the 200 period SMA is below both.

 

Conclusion:

After rising to a high of $712 on Tuesday, the bullish wave was temporarily reversed and ethereum price started dropping reaching a low of $596. However, the downwards price correction attempt is being resisted by support near $600. We expect ethereum price to start rising again towards $713.24 during the next 24-48 hours.

Charts from Bitfinex, hosted on Tradingview.com

 

Tamersameeh

Share
Published by
Tamersameeh

Recent Posts

Crypto Whale Sparks 8x Surge In $OPK Price with Massive Buy-in

A mysterious crypto whale, who previously invested 9,600 SOL into tokens $Pnut and $FRED, has…

1 hour ago

Early ENS Investor Transfers $2.47M To Binance Amid Upcoming Token Unlocks

An early investor linked to the $ENS token recently transferred 154,000 ENS tokens, valued at…

1 hour ago

Wintermute’s Memecoin Strategy: BABYDOGE Ranks Among Top 3 Holdings

In a surprising turn, $BABYDOGE has climbed to the top three in Wintermute’s memecoin holdings…

2 hours ago

$Pnut’s Meteoric Rise: How A Tragic Squirrel Inspired A Memecoin Sensation

The $Pnut memecoin recently soared past a $120 million market cap, creating unexpected wealth for…

2 hours ago

Political Memecoins And High-Stakes Bets Surge As Election Approaches

With election season heating up, political memecoins like $PEOPLE, $MAGA, $HARRIS, and $TRUMP are surging.…

2 hours ago

TRX Price Prediction: Tron Network Fee Cut to Spark New ATH?

Back into Spotlight: Tron Network Fee Cut Could Push TRX to ATH, But This DeFi…

11 hours ago