Technically, the 4-hour chart indicators are moving higher after correcting extreme overbought readings.
Ether Price Perfect Test of Crucial Support
Yesterday we saw the start of a correction wave in the ETH/USD pair. There was a sharp decline as the pair moved from the $400.00 mark down below the $320.00 and $300.00 important supports.
However, as highlighted in yesterday’s analysis the $260.00-250.00 support zone acted as a crucial barrier for sellers. It also acted as a perfect buy zone for buyers.
The price traded as low as $261.00 and started moving higher. The upside move was strong as the price easily moved above the 23.6% Fibonacci retracement level of the last decline from the $394.00 high to $261.00 low.
The best part was a break above a bearish trend line at $325.00 on the hourly chart of ETH/USD. The pair was able to move past the 50% Fibonacci retracement level of the last decline from the $394.00 high to $261.00 low.
It means the recent correction wave is complete, and the pair is back in the bullish zone. At the moment, buyers are attempting a break above a key resistance area at $350.00, which also represents the 61.8% Fibonacci retracement level of the last decline from the $394.00 high to $261.00 low.
A break and close above $350.00-360.00 could open the doors for a move towards $380.00. On the downside, there is a bullish trend line with support at $330.00.
Moving on the to the 4-hour chart, there is a clear rejection from the $260.00-250.00 support areas. The last two candles are super bullish, signaling a sharp bounce back in Ether price.
To sum it up, ETH/USD held a crucial support at $250.00, which is a great signal that the medium to long term bullish trend is intact.