Technically, the pair closed below the 20 and 100 MA’s (hourly chart), signaling further downsides.
ETH/USD to Decline Further?
Yesterday, I highlighted a double bottom pattern, and mentioned that either Ether price will recover soon or decline below the $12.80 support to test $12.50. The price failed to hold the double bottom pattern support and extended its downside towards $12.50.
There was a minor consolidation above $12.80, and then the ETH/USD pair declined further. A new weekly low of $12.58 was created. The pair is once again consolidating, and it looks like it may repeat the same pattern once again.
It means the consolidation is about to finish and the price is set for more losses. There is a high probability of a test of $12.50. If the Ether bulls failed to protect losses, a move towards $12.40 is also possible.
On the upside, there is a bearish trend line formed on the hourly chart of the ETH/USD pair, which can be considered as a resistance area if the pair corrects higher. Moreover, the 23.6% Fibonacci retracement level of the last drop from the $13.51 high to $12.58 low may also be considered as a hurdle on the upside.
The 4-hours chart of ETH/USD clearly highlights a failed double bottom pattern, but there is another important point to note. The same failed support area may now act as a resistance and stop any recovery from the current or a bit lower levels. Overall, the price remains in a downtrend and any corrections may face sellers on the upside.