The Bulls Have Saved ETHEREUM — For Now!
Welcome to this updated analysis on Ethereum! Let's get right to it! Looking at the four-hour chart, you can see that we're zoomed into the right shoulder of the large pattern on the chart. This is because we have an interesting development that is emerging right now. As you can see, ETH has rallied with the rest of the crypto space, and it is actually trading slightly above the neckline resistance (in red.) Now that we're back inside of the right shoulder, we could see a continuation into higher resistance levels, such as the 50 (in orange) and then the 1200 (in purple.) If you're wondering why I've got the 1200 up, it's because that is the 200 on the daily chart. The 200 of the hourly chart is above the (in blue) so the daily 200 is a level that could come into play in the near term, should ETH hold support above the neckline of the pattern. Interestingly, you can see that the 1200 is converging with a around 640.50, so that could be problematic if/when ETH gets there. For now, the 50 (in orange) is the immediate resistance level.
On the chart, we have a clear short-term reversal formation. After the bottom on 3/18, ETH rallied with the rest of the market, forming a bull flag. Now, you can see that we've broken out of that bull flag, and above the neckline resistance in the process. You can see that the projection of the extends above the 1200 EMA, so this flag is capable of yielding some nice upside, particularly if we get above the 50 EMA, which is being closed on as I write this. On the downside, a break back below the red neckline support would be very bearish. A confirmation above the 50 (in orange) will put the 1200 in the sights of ETH. Beyond that, we're likely to test the top of the downtrend channel.
If you're wondering what happened to the large breakdown, well, perhaps that's all we'll see. Or perhaps this is a bull trap before all hell breaks loose. Honestly, we can't currently know for sure. We need to see more data to know, so keep your eyes on the red neckline support. If we break back below that, that would be an indication of a bull trap. Above the 50 EMA, the potential for higher prices will increase. Good luck trading everyone!