ETH/USD Extends Downside & Remains Vulnerable
|A downside break was noticed in Ether price below $12.50 against the US Dollar.|
|The 2-hour chart of ETH/USD highlights continuous failures, igniting a downside move towards $12.20.|
|The pair bounced back, but the broken support near $12.70 is now acting as a resistance.|
Technically, the indicators moved in the bearish territory if we consider lower time frames.
Ether Finds Fresh Offers
Yesterday, we saw how there were continuous rejections near $12.90 in ETH/USD, a slight bearish tone in the hourly chart, and a couple of downside breaks.
Today, the price extended the downside, and broke an important support area at $12.70-12.60. A new weekly low was formed at $12.19 from where a recovery was started. ETH/USD was able to jump back from the $12.20 support, and now trading near a short-term resistance.
Considering the 30-min chart, the pair made a nice recovery, but the broken support at $12.70 might act as a barrier for further upsides. The price is now above the 50% Fibonacci retracement level of the latest decline from the $12.88 high to $12.19 low.
It is a positive sign, but the price needs to settle back above $12.70 to avoid an increase in the bearish pressure. Until then, ETH/USD remains vulnerable and may dive one more time.
Looking at the 2-hour chart, the breakdown candle looks more like a false break. I am personally not convinced with the recent downside break. Technically, there are a few bearish signs, but they are not conclusive enough to call it a real break.
However, it can be considered as the start of a downside move. If the price fails to break the $12.70 resistance, it may move down to complete a 3-waves pattern. In that situation, we might witness a new low below $12.19.
On the other hand, if the price settles higher, then there can be a retest of $13.00 (the all-important range resistance).