Ethereum price bound for another test of the psychological $4,000 barrier
- Ethereum price is positioned for another run to the $4,000 level.
- Failure to hold support could trigger a push towards new multi-month lows.
- Bulls and bears battle between $3,100 and $3,300.
Ethereum price action is mixed. The weekly close above $3,300 was necessary to establish support and create a pivot to push higher, but the daily displays weakness as sellers drive Ethereum below the past three days candlestick bodies.
Ethereum price looks for a return to $4,000 but must first stay above $3,000
Ethereum price action has been intense on the selling side during the Monday session. Sellers have pushed Ethereum to last Friday’s lows and don’t appear to be letting up anytime soon. As a result, the daily Tenkan-Sen at $3,170 is likely the target for bears.
The Tenkan-Sen is the final support level for Ethereum price bulls. If that fails, then another drive towards $2,500 is up ahead. However, there remains some significant support between $3,000 and $3,300. The 161.8 Fibonacci expansion, 61.8% Fibonacci retracement, and Tenkan-Sen share that $3,000 - $3,300 value area, so any move through it will likely not be easy.
A big warning sign for Ethereum price bulls on the daily chart is the hidden bearish divergence between the Composite Index and the candlestick chart. Note the lower highs and lower closes on the candlestick chart versus the higher highs in the Composite Index. Hidden bearish divergence is a warning sign that the current uptrend will likely terminate and resume a broader downtrend.
ETH/USD Daily Ichimoku Kinko Hyo Chart
However, weight should be given to the longer time frame. Despite the bearish nature of the current daily candlestick, last week’s weekly candlestick close was very bullish and supportive for Ethereum reversing and continuing its overall bull market uptrend.
Author
Jonathan Morgan
Independent Analyst
Jonathan has been working as an Independent future, forex, and cryptocurrency trader and analyst for 8 years. He also has been writing for the past 5 years.
