September 21, 2016 11:58 AM
ETH/USD managed to post yet another high above $14.00, and now positioning itself for a correction wave.
Ether price surged higher further against the US Dollar and traded as high as $14.31.
Yesterday, I stated that we may witness a reaction near the $14.00 resistance, and it looks like my view was correct.
The ETH/USD pair is currently struggling to hold gains, and may correct towards the $13.50-20 area.
Technically, the hourly chart is highlighting a short-term topping pattern around $14.30 level.
ETH/USD Reaction Zone
No doubt, the Ether continued to gain traction and bids during the past 24 hours against the US dollar and the Bitcoin. There was a new monthly high in ETH/USD at $14.31 and 0.0238BTC in ETH/BTC. The ETH/USD pair traded with a positive bias and posted good gains.
Yesterday, I highlighted a pattern break, which opened the doors for further upsides. The price did clear the $14.00 handle to post a high of $14.31. However, the upside could not last long. In my yesterday’s post I stated that there is a major reaction zone on the 4-hours chart at $14.00.
The price started struggling as soon as there was a move above the stated level. It moved down and now trading below $14.00. There is a bullish trend line formed on the hourly chart of the ETH/USD pair, which may act as a support if the price declines further.
The 38.2% Fibonacci retracement level of the last wave from the $12.34 low to $14.31 high is also meeting around the trend line. So, there is a chance of buyers appearing and providing support. The 4-hours chart of ETH/USD also points the importance of the same support area.
There was an ascending channel pattern, which was broken during the recent upside. Now, it may act as a support at $13.40-20. The last H4 candle also signals a short-term top, and calling for a correction wave.
Important Resistance Levels
$14.00 and $14.30
Important Support Levels
$13.40 and $13.20
The RSI technical indicator is pulling back from the extreme overbought levels, calling for a correction.
The MACD is currently in the bullish zone, but slowly fading.
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 marketsETHNews is commited to its Editorial Policy
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