TA: Ethereum Eyes Key Upside Break, Why Bulls Could Aim Larger Rally
Ethereum was able to clear the $3,800 resistance zone against the US Dollar. However, ETH price failed to gain strength above $3,900 and it is now consolidating gains.
Ethereum started a fresh increase above the $3,750 and $3,800 resistance levels.
The price is now trading above $3,800 and the 100 hourly simple moving average.
There was a break above a key bearish trend line with resistance near $3,840 on the hourly chart of ETH/USD (data feed via Kraken).
The pair could extend its rally if it stays above the $3,800 support zone.
Ethereum Price Gains Traction
Ethereum settled above the $3,650 level to move into a positive zone. ETH started a fresh rally above the $3,750 resistance zone and the 100 hourly simple moving average, similar to bitcoin.
The upward move was such that the price cleared the $3,800 resistance. Ether traded as high as $3,968 before there was a downside correction. The price corrected lower below the $3,800 level. However, the bulls were active near the $3,650 zone.
A low was formed near $3,640 and the price started a fresh increase. The price cleared the $3,800 resistance zone. There was a break above the 50% Fib retracement level of the recent decline from the $3,968 swing high to $3,640 low.
Besides, there was a break above a key bearish trend line with resistance near $3,840 on the hourly chart of ETH/USD. The pair is now trading above $3,800 and the 100 hourly simple moving average.
An immediate resistance on the upside is near the $3,890 level. It is near the 76.4% Fib retracement level of the recent decline from the $3,968 swing high to $3,640 low. The next major resistance is near the $3,910 level, above which the price might start a fresh surge.
Source: ETHUSD on TradingView.com
In the stated case, the price could climb towards the $3,980 level. Any more gains could set the pace for a move towards the $4,120 level in the near term.
Dips Supported in ETH?
If ethereum fails to continue higher above the $3,890 and $3,910 resistance levels, it could start a fresh downside correction. An initial support on the downside is near the $3,820 level.
The first key support is now forming near the $3,800 level and the 100 hourly SMA. If there is a downside break below the $3,800 support, the price could decline further. The next key support is near $3,720.
Hourly MACD – The MACD for ETH/USD is gaining pace in the bullish zone.
Hourly RSI – The RSI for ETH/USD is now above the 50 level.
Major Support Level – $3,800
Major Resistance Level – $3,910