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ETH/USD Forecast: Ether Trades In Wedge

By

Aayush

Jindal

Guest AnalystETHNews.com

Ether pared previous day’s gains against the US dollar and bitcoin. ETH/USD is currently following a major wedge pattern which may dictate the next move.

Key Highlights

Ether has formed a major descending wedge with support at $200.00-195.00 against the US dollar on the 2-hour chart.
The 4-hour chart of ETH/USD points a crucial bearish trendline with current resistance at $218.00.
ETH/BTC corrected 2 percent but remained above the 0.085BTC support zone.

Technically, the 6-hour chart indicators are struggling to gain bullish momentum, suggesting caution.

Why Ether Price Failed Near $225.00?

Yesterday, we saw how ETH/USD’s upside move was capped by $225.00. The pair struggled after creating a minor top at $226.40 and traded lower.

Ether Price Technical Analysis Chart

Looking at the 2-hour chart, there is a major descending wedge with support at $200.00-195.00 formed. The recent rejection at $225.00 was near the wedge trendline resistance.

At the moment, the pair is trading near the wedge support at $200.00. Considering the price action, it seems like the pair is in an indecision phase. The last 4-5 candles on the 2-hour chart are improper and suggesting neutral bias.

If ETH/USD fails to move below the wedge support, a move towards $220.00 is the most likely scenario. However, a breakout above the wedge resistance at $220.00 would risk stronger upside towards $250.00.

Ethereum ETH/USD Forecast

Moving on to the 6-hour chart, there are a few important points to note:

  • There is a crucial bearish trendline with current resistance at $218.00, capping the upside move.
  • The same trendline stopped the last wave near $225.00.
  • The $225.00 level acted as a support turned resistance and prevented gains.
  • On the downside, there is a monthly support formed at $175.00.

It seems like the pair is in a 3-wave pattern and the first leg was from $174.08 to $226.40. The pair is currently in the second leg from $226.40 to $193.01, which is about to complete.

The final third leg could decide the next move in ETH/USD, depending on whether buyers can contain losses below $200.00.

In the short term, the momentum is clearly negative, but it has again come down a daily close below $200.00. The next 4-5 sessions could end indecision.

Important Resistance Levels

$220.00 and $225.00

Important Support Levels

$200.00 and $190.00

2-hour RSI

The RSI is well below the 50 level and suggesting weakness.

2-hour MACD

The MACD is slowly moving in the bullish zone.

Aayush Jindal

Aayush has spent over seven years as a financial markets contributor and observer. He specializes in market strategies and technical analysis, comes with an IT background. He possess strong technical analytical skills and is well known for his entertaining and informative analysis of the currency and commodities markets. He is a software engineer by profession, loves blogging and observing financial markets

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The content on ETHNews.com is provided for informational purposes only and it is not intended to be, and does not, constitute financial advice or any other advice. You should not rely on any ETHNews.com content to make an investment decision. ETHNews.com is not responsible for any investment decision made by you. You are responsible for your own investment research and investment decisions.