ETH/USD technical analysis and why the market may still rally
- $1000 acted as solid support for Ethereum
- A triangle as a reversal pattern reveals a bullish medium-term perspective
- The rally on the small timeframes might continue
The cryptocurrency market rebounded in 2023 after a bearish market in 2022. Bitcoin led the decline, and other cryptocurrencies, such as Ethereum, followed.&
The US dollar’s strength is part of the reasons investors fled the cryptocurrency market. But other factors also contributed to the so-called “crypto winter” from last year. For example, the FTX scandal left many investors without funds.&
But against all odds, the crypto market rebounded in 2023. Bitcoin is up close to 50%, and Ethereum followed.&
So here is a technical analysis based on the long, medium, and short-term perspectives for the ETH/USD. Where will Ethereum go next?
ETH/USD long-term view
The one thing that strikes the eye on the monthly chart (besides the huge drop in 2022) is the strong support offered by the $1000 level. Often, the round numbers offer support or resistance, and it appears to be the case here.&
The larger the timeframe, the stronger the support or resistance is. This being the monthly chart, we should not be surprised that Ethereum bounced from support.
The medium-term perspective
Coming down to the daily chart, the bullish bias remains. Ethereum consolidated above the support level mentioned earlier and formed a contracting triangle.&
This triangle acted as a reversal pattern, as the price broke above the upper trendline. Therefore, the end of the triangle should act as an invalidation level for any long trade.&
The short-term view
From a short-term perspective, the market appears to form a pennant. This is a short-term consolidation pattern usually followed by another rally.&
However, until the price breaks higher, it is difficult to anticipate the market’s direction on such a small timeframe.&
Nevertheless, Ethereum formed an inverse head and shoulder pattern around $1,500. The lowest point on the pattern should act as a warning signal for bulls, should the price reach it.&
All in all, the positive momentum in the cryptocurrency market continues. As a result, Ethereum’s technical analysis has a bullish bias.&
The post ETH/USD technical analysis and why the market may still rally appeared first on CoinJournal.
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