Analysis

Ethereum Nosedives From $415, But Technicals Suggest Uptrend Isn’t Over Yet

Ethereum rallied more than 5% and broke the $ 400 resistance against the US Dollar. ETH price retreated sharply from $ 415, but technicals suggest uptrend remains intact above $ 340.

  • ETH price surged above the $ 380 and $ 400 resistance levels against the US Dollar.
  • There was a strong bearish reaction from the $ 415 level and the price dumped more than $ 50.
  • There are two key bullish trend lines forming with support near $ 365 and $ 340 on the 4-hours chart of ETH/USD (data feed via Kraken).
  • The pair is likely to recover and rise above $ 380 as long as it is trading above $ 340.

Ethereum Price is Correcting Gains

In the past few days, there was a strong increase in Ethereum above the $ 300 and $ 320 levels against the US Dollar. ETH price even broke the $ 350 resistance and settled well above the 100 simple moving average (4-hours).

The upward move was strong and ether surged above the $ 380 and $ 400 levels. The price traded to a new multi-moth high near the $ 415 level and it is currently correcting lower. There was a sharp bearish reaction from the $ 415 swing high and the price dropped more than $ 50.

There was a huge spike below the $ 350 support level. The price even dumped below the 50% Fib retracement level of the recent surge from the $ 316 swing low to $ 415 high. However, ether remained well bid near the $ 300 support level and the 100 simple moving average (4-hours).

Ethereum

Ethereum price trades above $ 400. Source: TradingView.com

It traded close to the 1.236 Fib extension level of the recent surge from the $ 316 swing low to $ 415 high. More importantly, there are two key bullish trend lines forming with support near $ 365 and $ 340 on the 4-hours chart of ETH/USD.

The pair is currently recovering and it is back above the $ 350 level. An initial resistance is near the $ 380 level, above which the bulls may perhaps push the price above $ 400. A daily close above the $ 400 level could lead the price towards the $ 420 and $ 432 levels in the coming days.

Downsides Limited in Ether (ETH)?

If Ethereum remains below the $ 400 and $ 380 resistance levels, there could be more downsides. The first major support is near the $ 340 level, below which the price might struggle in the short term.

The next major support is near the $ 305 and $ 300 levels (the recent breakout zone), below which the bears are likely to target an extended correction towards the $ 280 support level.

Technical Indicators

4 hours MACD – The MACD for ETH/USD is losing momentum in the bullish zone.

4 hours RSI – The RSI for ETH/USD is still above the 50 level.

Major Support Level – $ 340

Major Resistance Level – $ 380

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