Ethereum is consolidating in a contracting range above the $565 support against the US Dollar. ETH price must surpass $05 to start a strong upward move towards $625 and higher.
- ETH price found support near $565 and started a steady recovery against the US Dollar.
- The price is currently trading above $580 and the 100 simple moving average (4-hours).
- There is a major contracting triangle forming with resistance near $602 on the 4-hours chart of ETH/USD (data feed via Kraken).
- The pair could rise sharply towards $600 or higher if it clears the $605 resistance.
Ethereum Price is Forming A Key Breakout
This past week, bitcoin and ethereum saw a minor downside correction below $18,800 and $580 respectively against the US Dollar. ETH price even spiked below the $572 support, but it remained stable above the 100 simple moving average (4-hours).
The $565 support zone acted as a strong barrier for the bears. A swing low was formed near $561 and the price started a fresh upward move. Ether climbed above the $575 and $580 levels. There was also a break above the 50% Fib retracement level of the downside reaction from the $625 swing high to $561 swing low.
Source: ETHUSD on TradingView.com
The price is now approaching a major resistance area near $600. There is also a major contracting triangle forming with resistance near $602 on the 4-hours chart of ETH/USD.
The triangle resistance is close to the 61.8% Fib retracement level of the downside reaction from the $625 swing high to $561 swing low. A successful break above the triangle resistance and $605 is must to start a strong increase. The next major resistance is at $620, above which the price could break the $636 yearly high.
Fresh Decline in Ether (ETH)?
If Ethereum fails to clear the $600 and $605 resistance levels, there is a risk of a bearish reaction. An initial support is near the $592 level.
The first major support zone sits near the $590 level and the triangle lower trend line. A downside break below the triangle support might lead the price towards the $565 support and the 100 simple moving average (4-hours).
4 hours MACD – The MACD for ETH/USD is slowly losing momentum in the bullish zone.
4 hours RSI – The RSI for ETH/USD is showing positive signs and it is above the 50 level.
Major Support Level – $590
Major Resistance Level – $605