Recent trading activities reveal that Ethereum is approaching an important point in its trading because it forms a bearish triangle pattern, signaling a possible significant breakout. If the cryptocurrency breaks below the lower boundary of this triangle, it may lead to a pointy decline towards the $2,160 goal.
This text goals to supply readers with an in depth technical evaluation of Ethereum’s price motion, emphasizing the importance of the bearish triangle pattern that has emerged on the charts. It can also explore how this pattern indicates a possible downward move toward the $2,160 support level.
Up to now 24 hours, Ethereum has gone up by 2.11%, reaching around $2,642, with a market capitalization of over $317 billion and a trading volume exceeding $21 billion on the time of writing. ETH’s market cap has increased by 2.32%, while its trading volume has surged by 33.62%
Analyzing Current Price Actions Inside The Bearish Triangle
On the 4-hour chart, ETH’s price is currently trading below the 100-day Easy Moving Average (SMA) and is moving closer to the lower boundary of a bearish triangle, with several bearish candlesticks forming. This means a prevailing bearish sentiment available in the market and suggests the potential for further price declines.
Ethereum trending toward the lower boundary of a bearish triangle | Source: ETHUSDT on Tradingview.com
Moreover, an examination of the 4-hour Composite Trend Oscillator reveals that each the signal line and the SMA line are currently within the overbought zone, with the signal line attempting to cross below the SMA line. This means that bearish pressure is increase for the cryptocurrency, potentially leading to more price declines.
On the 1-day chart, Ethereum stays below the 100-day SMA and, with a single bearish candlestick, is approaching the lower boundary of the bearish triangle. Given the present price motion on the day by day timeframe, it seems that bearish momentum is increasing, which could potentially result in a price breakout.
Ethereum’s bearish strength sparks bearish triangle breakout below | Source: ETHUSDT on Tradingview.com
Finally, the composite trend oscillator on the 1-day chart also suggests a possible for continued bearish movement, with each the signal line and the SMA line within the oversold zone, showing no signs of crossing above.
Potential Scenarios For Ethereum Following A Breakout
If Ethereum’s current trading activities result in a breakout below the bearish triangle, the worth may proceed to descend toward the $2,160 support level. When the crypto asset reaches this level and breaks below, it may lead to an additional bearish move toward other lower levels.
Nevertheless, if Ethereum fails to interrupt below, it would start moving toward the upper boundary of the bearish triangle. Should the cryptocurrency break above this upper boundary, ETH could proceed to rise to check the $2,816 resistance range and possibly advance to challenge higher levels if the worth surpasses this resistance.
ETH trading at $2,623 on the 1D chart | Source: ETHUSDT on Tradingview.com
Featured image from iStock, chart from Tradingview.com