Ethereum’s rejection at $370 pokes holes in various key levels, leading to a revisit to $345.
ETH/USD has a higher chance of resuming the uptrend as opposed to continuing the breakdown.
Ethereum did break the resistance I discussed earlier this week at $360. However, the breakout did not materialize as expected. Instead, Ethereum hit a wall at $370 and embarked on another retreat. The smart contract token slumped below $360 and even tested the critical support at $345. At the time of writing, Ether has made a minor reversal above $350 and is teetering at $352.
The trend seems to be in favor of the bears even as they focus on sending Ethereum back to $320. However, the second-largest cryptocurrency is holding at the 50 Simple Moving Average (SMA) in the 4-hour range. It is essential that bulls work hard to keep the price above this moving average. Otherwise, the selling pressure in the market still has the momentum to force the crypto down the key levels at $345 and $330 for a revisit to $320.
The Relative Strength Index (RSI) has slowed down the retreat momentum and is currently holding at 45. The horizontal motion at this level hints at the possibility of consolidation taking over.
ETH/USD 4-hour chart
On the flip side, ETH/USD is trading below a descending trendline, forming part of a triangle pattern. Usually, descending triangle patterns signal the continuation of a bearish trend. A break below $320 would send Ethereum to $300 or even worse, $280. But first, the bears have to break the support at $345.
IntoTheBlock’s IOMAP model reveals ETH trading between levels of immense resistance and support. On the upside, the crypto is encountering headwinds between $354 and $363. If this zone is broken and flipped into support, the price would rally to $385. On the downside, support at $342 – 353 is stronger than the described resistance. Therefore, the odds are in favor of the bulls, who might regain control of Ethereum, invalidating the bearish case.
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