Technically, the 2-hour chart indicators moved sharply in the bearish territory.
ETH/USD’s Support Turned Resistance
It seems like the $740.00 resistance turned out to be a major barrier for ETH/USD buyers. The pair failed to move past this and declined sharply below the $710.00 and $700.00 support levels.
There was also an increase in selling pressure on bitcoin, which kept the ETH/BTC pair in a positive zone above the 0.0820BTC support. It may continue to slowly move higher toward the next resistance at 0.0850BTC.
Let’s analyze the 2-hour chart of ETH/USD to understand the recent decline of more than $50.00. The pair faced a strong sell wall near the $740.00 resistance, resulting in a major downward reaction.
The price declined and broke two important bullish trendlines with support near $710.00. Ether saw an increase in bearish momentum, pushing the price further below the $700.00 handle.
During the decline, Ether’s price even broke the 50 percent Fibonacci retracement level of the last major wave from the $638.62 low to $741.80 high at $685.
Later, a minor recovery was initiated from the $676.72 low. However, recoveries were limited and capped by the $710.00 level (previous support). The price declined back below $700.00 and resumed its downward trend. It broke a connecting bullish trendline with support at $690.00 on the 30-minute chart to move back in a bearish zone.
To the downside, there are many supports sitting near $670.00 and $660.00. Therefore, should there be a bearish extension below $675.00, buyers are likely to protect further losses. The last line of defense sits near the last swing low at $640.00, which is a crucial support.