Ethereum price suggests possible correction but faces challenges
Ethereum price suggests possible correction but faces challenges
The Struggle for Ethereum Price Recovery
Ethereum, the second-largest cryptocurrency by market capitalization, is currently attempting a recovery wave from its recent decline against the US Dollar. However, it faces significant challenges in surpassing the $1,600 resistance level and may potentially resume its downward trajectory.
Ethereum’s Uphill Battle
The price of Ethereum has been gradually moving higher, approaching the critical $1,600 resistance zone. Unfortunately, it is still trading below this level, as well as the 100-hourly Simple Moving Average. Moreover, a major bearish trend line is forming with resistance near $1,595 on the hourly chart of ETH/USD.
The inability to break through the $1,600 resistance could lead to a fresh decline for Ethereum. The crypto asset must overcome this hurdle in order to foster a sustained recovery.
Ethereum’s Recent Performance
Ethereum recently experienced a decline below the crucial levels of $1,620 and $1,600. Unlike Bitcoin, which remained relatively stable, ETH dropped to a new weekly low, falling below the $1,580 level.
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After hitting a low of $1,565, Ethereum embarked on a short-term upside correction. It managed to climb back above the $1,580 level, surpassing the 50% Fibonacci retracement level of the recent drop from the $1,600 swing high to the $1,565 low.
However, the bears remain active near the $1,600 resistance, hindering further progress. The price is currently struggling to clear the 76.4% Fibonacci retracement level of the aforementioned drop. Furthermore, Ethereum is trading below $1,600 and the 100-hourly Simple Moving Average, adding additional downward pressure.
Potential Resistance Levels
The $1,600 level represents a major resistance for Ethereum. A successful break above this level could potentially propel the cryptocurrency toward $1,620. Should the bulls manage to clear this hurdle, the price might experience a significant increase toward the $1,650 resistance. Further gains beyond this point could even open the doors for a move towards $1,700.
Potential for Further Losses
However, if Ethereum fails to surpass the $1,600 resistance, it might face another round of decline. Initial support on the downside is anticipated near the $1,580 level. Subsequently, the next key support level is at $1,565, below which the price could test the $1,540 support. A breakthrough below $1,540 could drive the price further into a bearish zone, potentially leading to a drop towards the $1,500 level.
Technical Indicators
Two important technical indicators for Ethereum’s price are the hourly Moving Average Convergence Divergence (MACD) and the Relative Strength Index (RSI). Currently, the MACD for ETH/USD is losing momentum in the bearish zone, while the RSI is above the 50 level. These indicators suggest mixed signals in terms of Ethereum’s short-term price movement.
Summary
Ethereum, like many cryptocurrencies, faces challenges in its attempt to recover from recent lows. Its struggle to surpass the $1,600 resistance level keeps the price in a precarious position. While the potential for a bounce-back exists, failure to break through this resistance could lead to further losses. Traders and investors will undoubtedly monitor Ethereum closely in the coming days to gauge the trajectory of this vital cryptocurrency.