1-Day Analysis:
Big Picture: Ethereum tested lower supports and evoked a significant reaction. The current emerging candlestick pattern is a hammer formation, which indicates the presence of demand at lower levels. This response now requires buyers to follow through and a break over the 1680 level to maintain momentum. If Ethereum falls below these aggressive EMAs, the momentum is expected to decelerate and the price may be exposed to lower supports before recovering back.
On the Upside Ethereum is seeing profit-taking after failing to push over the 1680 resistance level. It is now likely to face intraday resistance at 1608, followed by 1640. Breaking through these resistances will allow a re-test of the 1680 level. This level has been a strong resistance level for Ethereum for over 135 trading sessions and has not been breached. A successful breakthrough over this resistance level will be a significant milestone for the bulls, who are then expected to target the 1735 levels initially, followed by the 1790 to 1820 range.
On the Downside Ethereum has lost its daily EMA-250 support level and is now seeking support from the EMA-200 mark. This is Ethereum’s second time trading over the EMA-250 level in over a year. Reclaiming this level in the near term will be essential for keeping the bullish momentum; else, a prolonged corrective drop remains possible. Both the EMA-200 and the horizontal levels are providing support to Ethereum at 1520. Maintaining 1520 support is important for the price. Any buildup of pressure below this support level raises the possibility of additional bearish re-tests coinciding with Fibonacci levels.
