The Ethereum price bore the brunt of bears in the second half of May 2021.
Luckily, the market-wide re-calibration wasn’t specific to Ethereum alone.
Compared to the performance of other digital assets, ETH’s losses are not profound. For this, the coin, at spot levels, continues to outperform Bitcoin and preferred by developers over other “Ethereum killers” tokens.
As of writing, the ETH price remains in range, capped to the upside by $2.9k and $2.5k on the lower end.
Although there are hints of weakness, the rejection of lower lows and the formation of a double-bar bullish reversal pattern in the tail end of May 2021 may be the launching pad for Ethereum bulls.
ETH/USD Candlestick Arrangement in Higher Time frames
Taking a top-down approach, it would be ideal if ETH/USD closes above $3.2k, clearing May 19 highs and unwinding losses.
Critically, this could fan demand, subsequently lifting ETH/USD prices to new levels and canceling bearish candlestick formation in the weekly and monthly charts.
As observed, May’s bar closed as a Doji above the upper BB—pointing to over-extension and a high possibility of a dump down for equalization.
In the weekly chart, ETH/USD prices are rebounding from the middle BB. The zone between $1.5k and $1.8k is a vital support for the second most valuable network.
Understandably, it is why most traders are cautious, hesitant to commit in the face of a possible correction.
Ethereum Faces Resistance at $2.9k, Bulls Expect a Surge to $3.4k
All the same, traders are optimistic. There would be more room for ETH bulls to commandeer price action, especially if $2.9k is cleared.
VincePrince on Trading View marks out resistance at this level now that ETH/USD prices are moving inside a rising channel in the 45 minutes chart.
He observes that the ETH/USD prices have been inching higher with decent participation, rejecting lower lows in the past few trading sessions.
The immediate target for Ethereum bulls if the resistance trend line and $2.9k is broken will be $3.4k.
It is the same view Babenski on Trading View holds.
The technical analysts note that ETH/USD prices are moving inside an ascending triangle with critical reaction points at $2.5k, the main multi-week support trend line, and $2.9k resistance.
A close above $2.9k may trigger demand, subsequently lifting ETH/USD towards $3.8k.
On the reverse side, losses below $2.3k could see bears take charge, driving ETH/USD towards $2.3k.
Most traders are singling out $2.9k as an important resistance level in the immediate term, even on Twitter. For sell trend continuation, bears have to intensify their liquidation and defend this mark.
— BullvsBear Trading System (crypto) (@BullvsBear_ts) June 6, 2021
ETH/USD at the Cusp, a Breakout Imminent
Shifting out to YouTube, another trader Crypto Rover is convinced ETH/USD’s breakout is imminent. From the daily chart RSI, momentum is building up, and ETH prices are also moving up in lockstep.
The double-bar bullish reversal pattern of May 23 and 24, for example, saw RSI turn from oversold territory.
Besides, ETH/USD prices are printing lower highs, right off the main resistance level at the back of low trading volumes.
While buyers are optimistic, traders shouldn’t throw caution to the wind and commit.
At the third section of a rising triangle (clear in lower time frames), the best strategy could be sitting tight and waiting for a breakout before riding the new defined trend.
Charts courtesy of Trading View
Disclaimer: Opinions expressed are not investment advice. Do your research.
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