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TA: Ethereum (ETH) Back Below $3K, Why Rally Isn’t Over Yet

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Ethereum started a strong rally above the $3,000 resistance against the US Dollar. ETH price is now correcting gains, but it is likely to find bids near $2,840.

  • Ethereum gained pace after it broke the key $2,840 resistance zone.
  • The price is now trading above $2,900 and the 100 hourly simple moving average.
  • There was a break below a key bullish trend line with support near $2,980 on the hourly chart of ETH/USD (data feed via Kraken).
  • The pair is correcting gains, but there is a strong support waiting near $2,800.
Ethereum Price Corrects Gains

Ethereum started a strong rally above the $2,700 and $2,850 resistance levels. ETH price even broke the $3,000 barrier and it settled nicely above the 100 hourly simple moving average.

It traded to a new multi-week high at $3,190 before there was a downside correction. The price traded below the $3,000 support zone. There was a break below the 23.6% Fib retracement level of the recent surge from the $2,725 swing low to $3,190 high.

Besides, there was a break below a key bullish trend line with support near $2,980 on the hourly chart of ETH/USD. Ether is now trading above $2,900 and the 100 hourly simple moving average.

It is finding bids near the 50% Fib retracement level of the recent surge from the $2,725 swing low to $3,190 high. On the upside, an immediate resistance is near the $3,000 level. The next key resistance is near the $3,050 level.

Source: ETHUSD on TradingView.com

A clear break and close above the $3,000 and $3,050 resistance levels might start another increase. In the stated case, the price could rally above $3,200. The next stop for the bulls may possibly be near the $3,400 level.

Dips Limited in ETH?

If ethereum fails to continue higher above the $3,000 and $3,050 resistance levels, it could start an extended downside correction. An immediate support on the downside is near the $2,900 level.

The next major support is near the $2,840 level. It is near the 76.4% Fib retracement level of the recent surge from the $2,725 swing low to $3,190 high. Any more losses could lead the price towards the $2,740 support zone.

Technical Indicators

Hourly MACD – The MACD for ETH/USD is slowly losing pace in the bearish zone.

Hourly RSI – The RSI for ETH/USD is now below the 50 level.

Major Support Level – $2,840

Major Resistance Level – $3,050


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