Ethereum Recovers After Rebounding Off Support
JFD Team | May 13, 2022 07:57AM ET
ETH/USD enter a recovery mode after it tumbled and hit support at 1685. The recovery brought the crypto back above the 2000 mark, but it remains well below the downside resistance line drawn from the high of Apr. 3. Thus, even if we see some further advances, we will consider the short-term outlook still negative.
The recovery may continue for a while more, with the crypto perhaps overcoming the 2195 barrier, marked by the inside swing low of May 10. The bears could still take charge from near the 2455 resistance zone, marked by the peaks of May 10 and 11, and a potential dive could lead them to the 1865 barrier, marked by an intraday swing low formed yesterday afternoon.
A dip below that barrier could pave the way towards the low of the day at 1685, the break of which would confirm a forthcoming lower low on the daily chart and may see scope for declines towards the 1395 territory, which provided support back in February 2021.
Looking at our short-term oscillators, we see that the RSI lies above 30, pointing up, while the MACD, although negative, runs above its trigger line, pointing north. Both indicators detect slowing downside speed and support the notion of some further recovery before the next leg south.
To abandon the bearish case and start examining whether the bulls have stolen all the bears’ swords, we would like to see a decisive break above the 2745 barrier. That zone acted as key support between Apr. 27 and May 3, and its break could also confirm the break of the downside line drawn from the high of April 3.
The bulls could then aim for the 2975 zone, which acted as a key resistance on Apr. 28 and May 4, the break of which could pave the way towards the high of Apr. 21, at 3175. Another break, above 3175, could see scope for advances towards the 3305 or 3400 zones, marked by the high of Apr. 8 and 4, respectively.
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