The bear market has been quite harsh to all major altcoins including Ethereum. Over the past 24 hours ago, the coin dipped by 4%. In the last week however, Ethereum tried to stage a recovery. The bears continued to drag prices down despite that.
Buyers of Ethereum have tried to remain calm throughout most of the downswing. The consistent push by the bears have caused the altcoin to experience less to almost no recovery. The technical of the coin also pointed towards further fall in price before Ethereum starts to rise on the chart again.
In the recent developmental front, the altcoin has announced for its possible merge to happen in the month of August this year. It is to be seen if the altcoin’s price reacts positively to this news. A likeliness of a trend reversal cannot be ruled out as the chart below depicts it.
Ethereum was exchanging hands at $1900 at the time of writing. Continued fall below the current price level would cause the coin to trade at $1700. If buyers continue to remain scanty the coin could note a further 30% downfall and trade near $1200.
On the flipside the coin can trade above the $2000 mark slightly and then attempt to trade above the $2200 mark. The volume of Ethereum traded was still seen in red because bearish pressure had not declined in the market.
Ethereum continues to be underbought on the one day chart | Source: ETHUSD on TradingView
A chance of a possible downswing cannot be ruled out because the one day chart depicted at death cross. A death cross occurs when the short term moving average is below the long term moving average. On the SMA, 20-SMA was seen below the 50-SMA indicating weakness of ETH’s price in the market.
ETH’s price was below the 20-SMA line because sellers were driving the price momentum in the market. The Relative Strength Index was also weak in accordance with other techincals. RSI was below the zero-line, just above the 20-mark. This reading meant sellers preceded the number of buyers heavily at the time of writing.
Ethereum depicted negative price momentum on the one day chart | Source: ETHUSD on TradingView
Moving Average Convergence Divergence depicts the price momentum of the market. MACD flashed red histograms beneath the zero-line which indicated a continued bearish price action for the coin.
Awesome Oscillator also demonstrated green histograms below the half-line, in accordance with the MACD. AO flashing histograms below the half-line indicated a sell signal for Ethereum.
Possibility Of A Price Reversal?
Ethereum formed a falling wedge pattern on the one day chart. A falling wedge pattern in associated with a change in current price action or a trend reversal. At the moment Ethereum was on a bearish price momentum.
As falling wedge pattern was formed chance of the coin rebounding cannot be ignored. In case of a northbound movement, first resistance was at $2093 and then at $2200 respectively. For the bearish stance to be invalidated, Ethereum needs to trade above the $2900 mark.
Related Reading | Ethereum Prepares For Ropsten Testnet Merge As Token Struggles To Hold $2k Support
Featured image from UnSplash, Charts from TradingView.com