There were some hints from the decline in Open Interest that Ethereum could see a short-term correction under the $1600 mark. Subsequently, ETH fell below the $1580 level and retested it as a resistance, before slipping even lower. Altcoin’s market momentum remained to be in bare hands, at press time, with $1,450 coming up as a critical amount of support for bulls to defend.
Ethereum 1-hour chart
Over the past few days, ETH has seen a height of $1,600 after a decline as far south as $1,335, yet another fall down to $1,580 was underway at press time. The $1,580 and $1,420 amounts mark 23.6 percent and 38.2 percent of Ether’s retracement from $905 to $1877.
The price of the altcoin was trading on a descending channel trend. At the time of writing, it was trading above the middle point of the channel, and the $1,500-area could be used to open short positions with close stop-losses.
The upper boundary of the channel is likely to be checked if ETH closes a trading session above the mid-point of the channel, and the $1,500 psychological level could provide some confluence within the next few hours for this step.
However, the technical measures have stayed bearish. The Directional Movement Index has seen a rising ADX (yellow) and a-DI (pink) above 20 in order to signify a clear bearish pattern recently. The MACD was below zero and the RSI was at 42 to prove that the bears were still in play.
Finally, the fractals pointed out that during the last two weeks, $1,450 has been checked several times as support and resistance, giving it a high degree of concern in the short term.
Though Ethereum was bearish in the short term, the $1420-$1450 range has worked well as support in the past. A drop below the same, and a subsequent re-test of this location, would confirm further losses of $1320. A breakout over the declining channel will be a clear short-term bullish growth, but trading volume must still be corroborated to validate a shift towards $1580-$1600 for ETH.
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