Upon the 100-day EMA (1) breach at $1,494, the price of ethereum may drop sharply. Before the next phase takes ETH to $2,000, sidelined buyers may amass it for about $1,400. The bullish thesis for the ethereum price will be invalidated if a daily candlestick closes below the $1,343 support level.
The current trend
The price movement of Ethereum (2) shows worn-out bulls following an extraordinary increase over the previous five days. Given this uptrend’s tremendous obstacle, it will probably retrace to reliable support levels to refuel. The subsequent increase may push ETH beyond crucial psychological thresholds.
Ethereum price is prepared for a new obstacle
Around the $1,280 support level, where the price of ethereum showed remarkable endurance, there was a tight consolidation and sideways movement. However, the breakout was almost as remarkable as ETH increased by 25% in five days, creating a local peak of $1,594. Although this quick explosion caught many investors off guard, it was a clear move, as we indicated in our earlier piece. As we move forward, ETH might retrace to the 100-day EMA of around $1,494 as investors book gains.
Image source : Tradingview.com
If this level is broken, it will be possible to retest the $1,400 support level, which is also the 50-day moving average. A buildup at or near this level would be perfect for the next leg, which may drive the price of Ethereum to $1,784. The price of Ethereum may overcome this barrier and go for the psychologically significant $2,000 level, depending on the state of the market and the positive momentum. Investors would gain 44% overall from this move, which indicates that this is where ETH’s upward potential is limited.
What should be expected next
Even if the price of Ethereum is on the rise, the $1,400 support level must be protected at all costs. A breach of the barrier might mean one of two things: either investors are taking gains and hedging their bets, or selling are outnumbering buyers. A daily candlestick closure below the $1,343 support line will refute the bullish argument for ETH. Such a situation is expected to increase selling pressure and drive Ethereum’s price back to the $1,280 level.