Ethereum Recovers Sharply, But ETH Must Clear This Level For A Sustained Rally
Ethereum is up 7% and it broke the $340 resistance zone against the US Dollar. ETH price is now facing a major hurdle near $350 and $355, above which it could rally significantly.
- Ethereum started a steady recovery wave from the $313 swing low.
- The price broke the $340 resistance level and the 100 hourly simple moving average.
- There was a break above a major bearish trend line with resistance near $328 on the hourly chart of ETH/USD (data feed via Kraken).
- The pair is likely to continue higher if it clears the $350 and $355 resistance levels.
Ethereum Price Recovers 7%
After extending its decline below $320, Ethereum found support above the $310 level. ETH price traded as low as $313 and recently started a decent recovery wave.
Ether price broke the $320 and $330 levels to move into a short-term positive zone. There was also a break above a major bearish trend line with resistance near $328 on the hourly chart of ETH/USD. The pair gained pace above the $340 resistance level.
However, ether is now facing a major resistance near the $350 (the last key breakdown zone). A high is formed near $353 and the price is currently correcting lower. An initial support is near the $342 level and the 100 hourly simple moving average.
Ethereum price recovers above $340. Source: TradingView.com
The 23.6% Fib retracement level of the recent increase from the $313 swing low to $353 high is also near the $343 level. If there is a downside break below the $342 support zone, the price could correct lower towards $335.
The 50% Fib retracement level of the recent increase from the $313 swing low to $353 high is near the $335 level to provide support. On the upside, the bulls are facing a major resistance near $350 and $355. A successful close above the $355 resistance could open the doors for a sharp increase towards $365 or even $375.
Fresh Decline in ETH?
If Ethereum fails to recover above the $350 and $355 resistance levels, there is a risk of a fresh decline. The main support is now forming near the $335 level.
If ether price fails to stay above the $335 support, the current wave could turn bearish. In the stated case, the price is likely to decline below $320 and it might even revisit the $310 support.
Technical Indicators
Hourly MACD – The MACD for ETH/USD is now losing pace in the bullish zone.
Hourly RSI – The RSI for ETH/USD is currently correcting lower below 60 and towards 50.
Major Support Level – $335
Major Resistance Level – $355
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Aayush Jindal, @KhareemSudlow