The corrective rally in ETH price made a new low of $3300. When it reached this support, the price dropped about 38%, so it caused strong demand pressure. Price action and indicators have started to turn positive, preparing for a fresh rally.
Main technical points:
- Daily RSI slope above the 20 . SMA
- Ethereum 24-hour trading volume is $16.4 billion, showing a 2.17% loss
The source-Tradingview
Previously when we mentioned an article about Ethereum coins, the pair broke down from the 50% retracement support ($3300). The price provided a retest in the lower time frame chart and as warned dropped to $2900.
This bottom coincides with the 0.618 Fibonacci retracement level and provides strong support for the price. The chart shows a couple of candlesticks that rejected the price lower at this support before bouncing off with a bullish engulfing candle on January 11.
Even if the price action shows signs of recovery, the coin still faces a critical resistance level of the 200 SMA. The price will soon retest this EMA to confirm if the coin can start a new rally.
The daily Relative Strength Index (41) shows a significant rebound from the price action. Furthermore, the RSI slope has also regained the 20-SMA.
ETH Price Forms a Rounding Bottom Pattern
The source- Tradingview
ETH price has risen from the $2900 support. The coin is currently trading at $3,364, showing a 12.74% increase from the bottom support. This small bounce indicates the formation of a rounding bottom on the 4-hour time frame.
Following this pattern, the coin price will rise to the neckline of the overhead resistance of $3900, in hopes of starting a fresh rally. Currently, the price has broken the minor resistance of $3300, providing an entry opportunity for the long-term traders.
The Moving Average Convergence Divergence shows that the MACD and the signal lines are on the verge of crossing above the neutral line, showing that bullish momentum is increasing.
- Resistance levels- $3450 and $3365
- Support levels- $3300 and $2900.