Ethereum Retreats But Stays Above The $1685 Zone
JFD Team | Jun 03, 2022 07:40AM ET
ETH/USD traded slightly lower today after hitting resistance near the 1850 zone. However, although the crypto is trading below the downside resistance line drawn from the high of May 15, it remains above the key support area of 1685, thereby forming a descending triangle pattern. That triangle is also below a longer-term downside line, drawn from the high on Apr. 3, and thus, we see more chances for the price to exit the triangle to the downside rather than to the upside.
A clear and decisive break below 1685 would confirm a forthcoming lower low on the 4-hour and daily charts and encourage the bears to push the action towards the 1395 territory, which supported Feb. 23 and Mar. 1, 2021. If they are unwilling to stop there, we may see them pushing towards the 1205 territory, marked by the low of Jan. 22, 2021.
Shifting attention to our short-term oscillators, we see that the RSI, already below 50, turned down, while the MACD lies below both its zero and trigger lines, pointing south. Both indicators detect downside speed and add to the case of the crypto exiting the triangle through its lower bound.
Now to start examining whether the bulls have stollen all the bears’ swords, we would like to see a break above the upper bound of the triangle and a break above the aforementioned longer-term downside line and the 2455 territory marked by the high of May 10.
We could then see advances towards the 2745 barrier, marked by the inside swing lows of Apr. 27 and May 3, extending the gains towards the 2975 zone, marked by the highs of Apr. 28 and May 4.
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