Ethereum rebounded from support at $420 after rejection at $470.
ETH/USD is looking forward to a symmetrical triangle breakout to $500 amid the ongoing consolidation.
Ethereum bulls have in the last couple of days been working around the clock to ensure that formidable higher support is formed. The focus on the support comes after ETH/USD was rejected at $470 and forced to seek refuge at $420. At the moment, Ether is dancing at $447 following a minor dip under $450.
The prevailing trend is sideways leaning as emphasized by the Relative Strength Index (RSI). However, if buyers are not careful, Ethereum could resume the downtrend due to bearish divergence between the price and the RSI.
ETH/USD daily chart
A bearish divergence occurs when the asset is forming a series of higher lows, while the RSI forms a series of lower highs. The divergence indicates that the bullish momentum is losing traction and selling pressure could dominate.
is also trading within a symmetrical triangle pattern currently nearing its ultimate breakout. The chart pattern is created by a couple of converging trendlines connecting the price peaks and the toughs. The convergence should take place at approximately equal slopes. The symmetrical triangle pattern can result in either breakouts or breakdowns.
In this case, price action above the upper trendline could elevate ETH towards $500. The smart contract token may rally massively in such a move as the fear of missing out creeps on the investors.
On the other hand, trading under the pattern could pull Ether significantly downwards. Support would be anticipated at the 50 Simple Moving Average (SMA), the 100 SMA, slightly above $400, and the 200 SMA, marginally above $390.
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 firstname.lastname@example.org