Ethereum (ETH) Falls but Holds Above Support

The Ethereum (ETH) price fell this week but trades above an important horizontal support area.

Despite the decrease, ETH still trades inside a short-term bullish pattern. Will it break out?

Ethereum (ETH) Falls After Rejection

The ETH price has increased inside an ascending parallel channel since October 2023. The upward movement led to a high of $2,717 on January 12. 

While this seemed to cause a breakout from the channel, ETH fell shortly afterward, validating it as resistance (red icon) and creating a bearish candlestick. 

Ethereum has fallen since and is approaching an important horizontal support area.

The RSI is a momentum indicator traders use to evaluate whether a market is overbought or oversold and whether to accumulate or sell an asset.

Readings above 50 and an upward trend suggest that bulls still have an advantage, while readings below 50 indicate the opposite. The daily RSI gives a mixed reading. While the indicator is falling, it is still above 50.

What do analysts Say?

Cryptocurrency analysts and traders on X are divided on the future trend.

Crypto Tony noted the importance of the $2,400 level, suggesting that whether it holds or falls can determine the future trend.

IncomeSharks is bullish because he anticipates an OBV breakout. However, CrediBULL Crypto is still bearish. He tweeted:

Looks like the bearish scenario on $ETH has played out, would have been a beautiful short if I hadn’t closed but it is what it is! As per my last tweet think we have a bit lower to finish cleaning up these lows and then I think R/R will shift in favor of longs.

ETH Price Prediction: Bounce Incoming?

Unlike the daily chart, the six-hour one shows that ETH has traded inside a descending wedge since the aforementioned high. The descending wedge is considered a bullish pattern, which usually leads to breakouts.

Today, ETH bounced at the wedge’s support trend line (green icon), which coincides with the 0.5 Fib retracement support level.

Despite the bounce, the RSI is still below 50, failing to confirm the possibility of a reversal.

If ETH breaks out, it can reach the channel’s resistance trend line at $2,700, an increase of 9% from the current price.

Despite this bullish ETH price prediction, closing below the wedge’s support line at $2,410 can trigger an 8% drop to the channel’s support trend line at $2,300.

For BeInCrypto‘s latest crypto market analysis, click here.