Disclaimer: The findings of the following analysis are the only opinions of the writer and should not be considered investment advice.
In the past week, Ethereum [ETH] went into sideways orbit after breaking its bullish setup in the daily time frame. After recovering from the bearish flag’s downward trend, the bulls found renewed buying pressure and reclaimed their spot above the 20/50 EMA.
After flipping the trendline resistance to support, buyers asserted their strength as they broke through the 23.6% and 38.2% Fibonacci resistances.
A possible near-term rebound in the EMAs would position the alt to continue its upward trend in the coming sessions. As of going to press, the alt was trading at $1,527.7, down 4.92% in the past 24 hours.
ETH Daily Chart
ETH’s long-term trendline resistance has finally cracked after a recent comeback in buying. Meanwhile, the 20 EMA (red) has been looking north to show a strong buy market.
The coin saw an ROI of over 50% from the July 13 low, hitting the 50% Fibonacci resistance. Since then, the king alt has been consolidating in the $1,500 – $1,600 range.
The double bottom structure revived the underlying buying pressure that was lurking. Any bullish crossover on the 20/50 EMA would help buyers amplify their buying frenzy. In this case, the potential targets would be near the 61.8% Fibonacci resistance in the $1,850 zone.
Should buyers dwindle, any close below the 20/50 EMA could trigger a pullback towards $1300 before a likely rebound.
The Relative Strength Index maintained its position above the midline to reflect a buying advantage. Traders/investors should look for a rebound towards or below equilibrium to identify opportunities for a bullish invalidation.
Also, the DMI lines continued to show a strong selling advantage with a strong directional trend for ETH. While trading volumes have taken a dip, any recovery in the Volume Oscillator could lead to a surge in volumes.
Given the breakout of the double bottom above the EMAs in the near term alongside the bullish edge on technicals, ETH could see an ongoing recovery. The potential buy/sell targets would remain the same as discussed above.
Finally, investors/traders should watch out for Bitcoin’s movement. This is because ETH shares a staggering 30-day correlation of 94% with the king coin.
This post Ethereum: Bullish Crossover On This Would Help ETH Buyers
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