Ethereum's price faced significant pressures due to the recent regulatory crackdowns and the more hawkish expectations on interest rates. However, despite these challenges, the cryptocurrency displayed remarkable resilience and made a strong comeback once the market's hawkish sentiment subsided, and regulatory concerns eased. Additionally, the recent robust recovery from a critical support level hints at the possibility of further upward momentum, potentially leading to a breakout of the 2100 high.
Ethereum Technical Analysis – Daily Timeframe
On the daily chart, we can see that Ethereum has recently bounced back from a strong support at the 1681 level where we can also find the 61.8% Fibonacci retracement level and the upward trendline. Since then, the price rallied strongly into the downward trendline and now the formation looks like a descending triangle pattern.
The price can break on either side of the pattern and generally what follows is a strong move in the direction of the breakout. So, if the price breaks to the upside, we can expect Ethereum to reach again the 2000 level, while if it breaks to the downside, we should expect a fall into the swing low level at 1400.
Ethereum Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the rally is getting a bit exhausted as depicted by the long candlestick wicks near the trendline. This should be a sign of an imminent pullback and the likely support zone would be at the 1775 level. In fact, we can see that the price has reacted to that level multiple times in the past weeks and for more confluence we have the upward trendline and the 38.2% or 50% Fibonacci retracement level.
The price is also a bit overextended as shown by the distance between the price and the blue 8 moving average. In such instances, we can generally see some consolidation or a pullback into the trendline before the next move.
Ethereum Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more closely the support zone at the 1775 level with all the confluences mentioned above. If we get a pullback into the zone, the buyers are likely to lean on it with a defined stop just below it and target the breakout of the major downward trendline to reach the 2000 level. More aggressive sellers can lean on the downward trendline to target the support zone first and a break lower afterwards, while more conservative sellers should wait for the price to break below the upward trendline to target a breakout of the 1681 support that would open the door for a selloff into the 1400 level.
Today, we have the Fed Chair Powell testifying to Congress and if he sounds very hawkish, we should expect the above-mentioned pullback to play out. Tomorrow we will see the US Jobless Claims report, while on Friday we conclude the week with the US PMIs.
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