Chart by TradingView
Key Support level: $3,600
Key Resistance level: $4,000
Ethereum (ETH) has broken above the key resistance at $3,600 and successfully turned it into support on the 4-hour timeframe. With this breakout, the cryptocurrency has a clear path to retest the all-time high at $4,380.
The ATH will act as resistance until broken, and, therefore, profit-taking can be expected as soon as we reach a price above $4,000. This may cause a correction until ETH successfully breaks above the key resistance and enters price discovery once again.
Volume: The breakout volume on the 4-hour timeframe was strong. However, we need continuation and more volume to sustain the upward trajectory.
RSI: The RSI on daily and 4h timeframes is moving higher as expected. Once the RSI makes a higher high on the daily timeframe, the confidence in this uptrend will increase.
MACD: The recent bullish cross of the MACD moving averages on the 4h timeframe is a great indicator that price is posed to increase further. On the daily timeframe, things remain bullish and in anticipation of a new rally.
The overall bias is bullish, especially if the price remains above $3,600. With more volume and buyers coming in, ETH can continue to push higher and approach the ATH. This bias will change only if the price falls under $3,400. At that point, the current breakout would be confirmed as fake.
With the ATH in range, ETH appears ready to retest the key resistance at $4,000. Once there, the price might consolidate in a tight range as significant pushbacks aren’t expected. Eventually, ETH can break free from the current resistance and enter price discovery. Once that happens, further increases become very likely in the near future so long the overall market stays bullish.
The above analysis was written by DU09.
