Ethereum Price Analysis: ETH/USD Trend Overwhelmingly Negative
|Ether is under heavy selling pressure and failed to hold the $265.00 support against the US dollar.|
|A previous crucial support at $280.00 on the 4-hour chart of ETH/USD is now acting as a resistance.|
|ETH/BTC was neutral around 0.070BTC since the price of bitcoin fell by more than 4 percent recently.|
Technically, the 4-hour chart indicators are heading lower in the bearish territory.
Ether Price Breaks Key Support
Yesterday, we discussed how Ether could accelerate its decline against the US dollar and bitcoin. Buyers failed to hold a couple of key support levels in ETH/USD ($275.00 and $265.50), resulting in a bearish trend formation.
Looking at the 4-hour chart of ETH/USD, there was a close below a crucial support area at $280.00 which is now acting as a resistance and preventing recoveries. Above $280.00, there is a key bearish trendline forming with resistance at $305.00.
The price action and candle patterns on the 4-hour chart suggest a sharp rise in the bearish pressure on Ether after it failed to break the $300.00-$305.00 levels.
We can refer to the hourly chart of ETH/USD to understand the current trend and why Ether could decline below $250.00. There was a new two-month low established near $256.96 as the pair failed to hold the $265.00 support and the 50 percent Fibonacci retracement level of the last leg from the $133.79 low to $395.41 high.
There was a short-term bounce from $256.96, but the recovery was capped by a bearish trendline near $280.00 and the 38.2 percent Fibonacci retracement level of the last drop from the $316.17 high to $256.96 low.
The pair is once again heading lower and following a descending channel with current resistance at $270.00. It would soon retest the recent low of $256.96 and could even break it for a move towards the next important support near $233.00.
At the moment, the pair is down by more than 3 percent at $260.00, facing a tough challenge at $270.00 followed by $280.00 (support turned resistance) and finally $305.00. On the flip side, a break below $256.00 (recent low) would target $233.00 (important Fib level).