Ethereum (ETH) Technical Analysis: Looming Near Double-Digits, will ETH Break Below $100?

Nothing in this article is to be construed as investment advice. Neither the author nor the publication assumes any responsibility or liability for any investments, profits or losses you may incur as a result of this information.

Ethereum has managed to slow its sharp declining price action in the last 48hrs and establish a temporary support along the $107 level. In the absence of any obvious bullish catalysts and trading confidence still evidently low after the second Constantinople postponement, it is likely that this brief pushback is nothing more than auto trading bots buying up oversold ETH after the red market on Monday, or a dead cat bounce.

The Story So Far

On the 1D ETH/USD chart we can see that Ethereum has been tracking inside a falling wedge pattern since the New Year, after the price action failed to break back onto the 0.618 fibonacci level at $170.

On January 10, ETH plummeted by $24 during a heavy intraday sell-off through the 0.382 fib level and eventually found strong support along the 0.236 fib level. Over the next 17 days ETH fell into a bearish descending triangle, consolidating between a downtrending resistance and the flat fibonacci support until bears broke through on January 27.

The Story Now

Over 4H candles there are a number of indicators that appear to be supporting an upside recovering;

-RSI has recovered out of the oversold region and is now climbing back into the middle of the index channel.

-There is a bullish convergence between the 12 and 26 day moving averages, and buying candles on the histogram.

-The price action appears to be about to break bullishly over the central Bollinger Band.

-The Aroon Up line is also close to converging with the Aroon Down line, which suggests a trend reversal is likely.

While this seems promising, overall market sentiment still remains favourably bearish. Bitcoin’s recovery to $3,500 does not look particularly strong and even if Ethereum does manage to end the day in the green, the downtrending resistance of the falling wedge pattern is likely to keep ETH tracking in a downward direction.

The next main support region for ETH seems to be between the $102 and $95 levels (dark green area) which was a key area of support/resistance through early to mid December 2018. If the price action closes beneath this section then its likely that Ethereum will continue bearish towards its 2018 low around $82 (0.0 fib level) and potentially beyond.

Key Supports

All losses are calculated from the asset’s current value of $107 (AToW)

(1) $102 (-4.67%)
(2)
$95 (-11.21%)
(3) $82 (-23.36%)

Reading now