ETH – “Short-Coverings Likely”

4-Hour Analysis:

Big Picture: Multiple testing weakened the support. Ethereum breached the major trendline support, causing yet another big drop. It is presently trading at intraday support levels, where decent responses are possible. As a result, sellers should proceed with caution as long as these supports hold. Higher volatility is expected for the session.

On the Upside several new resistances have emerged. The first resistance will be encountered at 1510, followed by 1540. Surpassing these levels would then lead to 1570. Breaking this resistance would be necessary to pull a move back towards 1640-1650. Expect partial profit-taking to be seen at these levels, however for Ethereum momentum above 1680-1700 remains the key to bullish reversal.

On the Downside Ethereum has taken significant support from 1448. Below this, the intra-day support at 1425 remains valid and effective. This support, however, now coincides with another possible trendline support, enhancing the significance of this level. Loss of this level could be a huge blow for bulls, who are then likely to be exposed further, first towards 1390, then potentially towards the CME Gap around 1320-1250.