Ethereum bulls are battling the prevalent resistance between $390 and $400.
ETH/USD may invalidate the bearish case by holding onto support between $363 and $374 according to IntoTheBlock’s data.
Ethereum price is facing tough resistance between $390 and $400. The smart contract giant token bid for gains past $400 was also invalidated in this same zone over the weekend. At the time of writing, ETH/USD is trading at $386 amid increasing seller congestion.
The 4-hour chart highlights a quickly growing seller concentration in the market as the Relative Strength Index points downwards after rejection at 60. If the indicator dips below the midline, we can expect bears to gain more traction, thereby pulling the price under $380.
For now, Ethereum is trading within an ascending triangle. The pattern is common in technical analysis and is used by traders to predict or confirm breakouts either up or down. However, it is important to realize that an ascending triangle is typically a continuation pattern. In this case, if confirmed, Ethereum will continue with the previous downtrend, aiming for $320.
Consequently, traders should keep in mind that Ethereum will try to seek support at the 100 Exponential Moving Average (EMA) ($376) and 50EMA at $372. If both of these tentative support areas fail to hold, then Ethereum will have little choice but to continue with the breakdown first to $340, and then to $320.
Ethereum IOMAP chart
On the other hand, the bearish case could be jeopardized entirely, especially when IntoTheBlock IOMAP metric is applied. For instance, Ethereum has immense support between $363 and $374. The support is provided by the 821,510 addresses that previously bought 11.28 million ETH in the zone. Unless Ethereum breaks this support, the above bearish case will be invalidated. Moreover, the path ahead will not encounter extreme bearish pressure, which means if bulls believe in themselves to create the right volume, gains above $400 are still possible.
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