Analysis

Three Important Reasons Why Ethereum Could Tumble Below $220

Ethereum failed to continue higher above $ 233 and declined sharply against the US Dollar. ETH is now trading below the 100 hourly SMA and it could continue to move down.

  • Ethereum broke the key uptrend support level near $ 228 and the 100 hourly simple moving average.
  • The price is likely to resume its decline unless it surpass the $ 228 and $ 230 resistance levels.
  • The bulls failed to protect this week’s ascending channel with support near $ 228 on the hourly chart of ETH/USD (data feed via Kraken).
  • The previous support at $ 228 is now acting as a strong resistance and preventing recovery.

Ethereum Price Support Turned Resistance

This week, Ethereum price climbed higher steadily above $ 220 against the US Dollar. ETH price even broke the $ 230 resistance yesterday along with the 100 hourly simple moving average.

However, the bulls failed to hold ground, resulting in a fresh decline from the $ 233 swing high. Ether declined sharply below the $ 228 support level and the 100 hourly SMA to move back into a short-term bearish zone.

The bulls also failed to protect this week’s ascending channel with support near $ 228 on the hourly chart of ETH/USD. The pair traded as low as $ 223 and it is currently correcting higher. There was a break above the 23.6% Fib retracement level of the recent decline from the $ 233 high to $ 223 low.

Ethereum Price

Ethereum price dives below $ 230. Source: TradingView.com

On the upside, the previous support near the $ 228 level and the 100 hourly SMA is acting as strong resistance. It is close to the 50% Fib retracement level of the recent decline from the $ 233 high to $ 223 low.

It seems like there is a crucial resistance forming near $ 228, $ 230, and a new connecting bearish trend line on the same chart. Ether price must break these three hurdles to start a fresh increase towards $ 232 and $ 235 in the coming sessions.

Another Drop in ETH?

If Ethereum fails to clear the $ 228 resistance and the 100 hourly SMA, it could resume its decline. An initial support is near the $ 225 level, below which the bears are likely to take control.

The main support is now near the $ 222 level. A successful break and close below the $ 222 support may perhaps spark another decline towards the $ 205 support in the near term.

Technical Indicators

Hourly MACDThe MACD for ETH/USD is losing momentum in the bullish zone.

Hourly RSIThe RSI for ETH/USD is currently retreating from the 50 level.

Major Support Level – $ 222

Major Resistance Level – $ 230

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Analysis – NewsBTC

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