ETH/USD Forming Double Bottom Pattern?
|Ether price declined once again and traded towards the $7.00 handle against the US Dollar.|
|There is likely a double bottom pattern forming near $7.00, as the ETH/USD pair was rejected twice near it.|
|For an upside push, the pair needs to clear a bearish trend line on the hourly chart at $7.30.|
Technically, the indicators on the hourly chart are not convincing enough to call for an upside move.
Ether Price Upside Hurdle
Yesterday, I highlighted the possibility of a downside move towards the $7.10 level in Ether price against the US Dollar. The price not only tested the stated level, but also approached the $7.00 handle.
The hourly chart of ETH/USD highlights an interesting pattern. We can clearly see that the pair was rejected twice near the $7.02- 7.05 levels. So, there is a chance of a double bottom pattern.
However, the upside move due to the pattern formation is prevented by a bearish trend line on the same chart. As long as the pair is below the trend line, the pattern is not confirmed.
A successful close above the highlighted trend line may trigger more gains, possibly pushing the price higher. Moreover, a break above the 50% Fibonacci retracement level of the last drop from the $7.40 high to $7.04 low is also needed to confirm an upside move.
When we look at the 6-hour chart of ETH/USD, there are a few things to note. First, there is a base forming near $7.00. Second, there is a monster resistance at $7.50 (as stated in previous analysis as well). Last, the market sentiment is still not in favor of more gains in the near term.
So, we need to see how the market sentiment changes on higher timeframes if the price breaks above the trend line resistance on the hourly chart.