Ethereum Turns Red Below $3.4K, Why Upsides Might Be Capped

Ethereum started a sharp decline from the $3,530 zone against the US Dollar. ETH price dived to $3,260 and is currently correcting higher.

• Ethereum started a major decline from the $3,530 resistance zone.
• The price is now trading below $3,400 and the 100 hourly simple moving average.
• There is a major bearish trend line forming with resistance near $3,460 on the hourly chart of ETH/USD (data feed via Kraken).
• The pair could face a major resistance near the $3,425 and $3,450 levels.

Ethereum Price Dives 5%

Ethereum struggled to gain pace above the $3,525 and $3,530 resistance levels. ETH topped near the $3,525 level and started a major decline.

The price declined below the $3,450 and $3,420 support levels. There was also a move below the $3,400 level and the 100 hourly simple moving average. Finally, there was a sharp decline below the $3,300 level. It traded as low as $3,261 and is currently correcting losses.

There was a recovery wave above the $3,300 level. It broke the 23.6% Fib retracement level of the recent decline from the $3,580 swing high to $3,261 low.

The price is now facing resistance near the $3,400 level. The next major resistance is near the $3,420 level. It coincides with the 50% Fib retracement level of the recent decline from the $3,580 swing high to $3,261 low.  There is also a major bearish trend line forming with resistance near $3,460 on the hourly chart of ETH/USD.

Source: ETHUSD on TradingView.com

If ether price clears the $3,450 resistance zone, it could start a decent increase. In the stated case, the price could climb above the $3,500 zone. The next key barrier is near the $3,525 level, where the bears might take a stand.

More Losses in ETH?

If ethereum fails to start a fresh increase above the $3,420 level, it could start a fresh decline. An initial support on the downside is near the $3,300 zone.

The next major support is near the $3,250 level. If there is a downside break below the $3,250 support, the price could accelerate lower. In the stated case, there is a risk of a move towards the $3,050 level.

Technical Indicators

Hourly MACD – The MACD for ETH/USD is slowly losing pace in the bearish zone.

Hourly RSI – The RSI for ETH/USD is now below the 50 level.

Major Support Level – $3,250

Major Resistance Level – $3,420