September 2, 2016 9:13 AM
Ether buyers look like having a breather after the recent upside ride in ETH/USD. Let’s see if they can jump in again for another ride.
Ether price after posting a new weekly high of $12.86 yesterday against the US Dollar started consolidating gains.
There is a consolidation pattern forming on the hourly chart of the ETH/USD pair.
The pair may spike down to test the $11.50 support before moving back higher.
Technically, the 4-hours chart is indicating an extension of the current correction towards the $11.50 support.
Ether price after yesterday’s surge towards the $12.85 level versus the US Dollar found offers and started a consolidating pattern in the form of a correction. There is a chance that the ETH/USD pair may move a few more points lower before it gains traction once again.
The pair has already slipped below the 38.2% Fib retracement level of the last wave from the $10.50 low to $12.86 high. Currently, there is a correction underway and the pair has formed a contracting triangle pattern on the hourly chart.
The pattern may play a major role in the near term for the next move in ETH/USD. There is a possibility of the pair moving towards the 50% Fib retracement level of the last wave from the $10.50 low to $12.86 high.
If we have a look at the 4-hours chart of ETH/USD, there is a monster support at $11.50 as highlighted yesterday. It was a crucial resistance earlier and now may act as a support. The last 4-5 candles on the H4 chart are pretty bearish and clearly suggesting a short-term top.
It means the current correction may extend in the near term. In my view, there is a possibility of a spike down to test the $11.50 support where there can be heavy bids. I think staying on the buyer’s side as long as the price is above the stated support is a good idea.
Important Resistance Levels
$12.50 and $12.80
Important Support Levels
$11.80 and $11.50
The RSI technical indicator is hovering near the 50 level with no major bullish signs.
The MACD has moved into the bearish zone, suggesting an extension of the current correction.
Aayush has spent over seven years as a financial markets contributor and observer. He specializes in market strategies and technical analysis. He strives to provide entertaining and informative analysis of the currency and commodities markets. He is a software engineer by profession and loves blogging. ETHNews is commited to its Editorial Policy
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