- Ethereum broke the purple ascending trend line that was used as the backbone for the rally since July 21.
- Buyers stepped in and picked up Ethereum quickly.
- Price action is forming a triple top at $3,391.
Ethereum was in a bit of a bumpy ride after the correction on August 16. Price action dipped after ETH hit the price of $3,391, forming a short-term cap on the price action. Buyers could not push price action beyond this level and got caught in a two-day correction below $3,018. That $3,018 was a significant level on May 20, May 26 and August 5, making it a triple top. Once buyers pushed ETH above there, this level acted as support.
Ethereum needs to get above $3,391
Since last week, Ethereum is now in a squeeze to the upside. We get higher lows on the candles, while to the upside, price action remains around $3,391 and cannot push above. Expect the price to get further squeezed against that level, making it a short-term resistance point. The fact that the level already got tested three times to the tick shows its importance.
A move above has its importance, but a daily close above will be of even greater importance. Either in the coming days, buyers can push price action above it or not.
If they do, expect some hesitant action as ETH will hit that ascending purple trend line from below. Buyers will need to ante up their efforts to push price action further up. If they succeed in that, then $3,687 should be in reach in the coming weeks.
Failing to break the short-term cap at $3,391 will result in a break lower, possibly back to $3,018 or even the R1 monthly resistance level at $2,853.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.