Ethereum reverses from the resistance at $230; buyers seek support at $225.
ETH/USD bulls must not underestimate the selling pressure because $200 is still within reach.
The second-largest cryptocurrency is battling increased selling activities just like other major cryptocurrencies in the market including Bitcoin, Ripple and Bitcoin Cash. Last week, Ether rose significantly from the support at $240 and closed in on $250. However, due to the selling pressure at $250 and the generally bearish cryptocurrency market, ETH/USD tumbled to the extent of testing $215 support.
Meanwhile, a recovery ensued allowing buyers to reclaim every inch of the ground towards $230. Unfortunately, a barrier at $230, sabotaged the mission to extend gains towards $240. At the time of writing, ETH/USD is teetering at $227. Marginally above the market value is the initial but short term resistance at $228. The second hurdle is at $230 which if broken could pave the way for gains above $235 as well as $240.
ETH/USD 1-hour chart
The Relative Strength Index (RSI) has started to drop from the recent highs at 65. The downward action is strengthening the bearish grip. In other words, Ether could be forced below the initial support at $225. Note that, the support at $220 caved to the selling pressure last week. Luckily, buyer congestion at $215 put a stop to the declines.
The MACD, on the other hand, shows that all is not lost for the bulls and that they could redeem themselves. The indicator is holding the ground at the midline (0.00). It is also featuring a bullish divergence, putting more power into the bullish camp.
The formation of a bearish pennant pattern serves as a warning that the bulls should not underestimate the selling pressure in the market. Another drop below $220 might not be easy to stop at $215 but could spiral to $200.
Luke has had a long interest in financial technology, especially cryptocurrency and blockchain. With a Bachelors degree in Journalism and Media, Luke is dedicating his writing skills for the digital currency sphere.He can be contacted at email@example.com