The wall of 1700$ difficult to break down – Four days after the debacle of silver gate, the price of Ethereum (ETH) still remains knocked out below $1700. As it rowed through the weekend, a downward breather could be in sight as we look forward to important macro headlines throughout March. And after two consecutive months on the rise, it would be legitimate in order to potentially build a price structure favoring the neutralization of the current bear run.
That said, headwinds such as the rebound in the dollar and bond yields are prompting early signs of concern about the strength of the crypto prince’s rebound. In the immediate future, a certain caution could prevail as the major deadlines approach.
And in a market context that mixes hope and fear, let’s review the latest technical analyzes of the prince of cryptos and possible scenarios, two weeks before the next FED meeting.
Ethereum in Monthly Units – Towards a Red Mars?
Ethereum is starting March off on the wrong foot by opening below $1700 and the descending line. Although the decline is currently minimal, it is clear that the bulls come up against a double obstacle. So much so that the prospect of a neutralization of ETH’s bear run since its last ATH in November 2021 is receding.
However, the courses and the Chikou Span still have a respectable margin of safety beyond the Kumo (Cloud) in monthly units. On the other hand, the other favorable signal to remember comes from the significant bearish gap between the Tenkan and the Kijun. As a reminder, the second tends to react slowly to price dynamics compared to the first. A reconciliation of the two Ichimoku curves would help to decant the lethargic situation of the Ethereum price since June 2022.
But on the other hand, the prince of crypto shouldn’t hang around under $1700 for too long. Because otherwise, we would risk testing the next supports. A clear and precise rejection below this resistance would push the bears to push the price of Ethereum down to $1400. This support could be the tipping point one way or the other with fear of a red mars. This is what we will see on the weekly chart.
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Ethereum in weekly units – A third consecutive week of declines?
Things get clearer in weekly units. Indeed, the price of Ethereum ended a second consecutive week of decline below $1700. He now threatens the Tenkan for a pass of three against the bulls. Jerome Powell’s hearings in Congress and the House of Representatives, then the weekend US employment figures, could provide a little spark in order to highlight a clear trend.
For the moment, THE status quo of the price of ETH and the Chikou Span under the Kumo are not ready to be thwarted by the bulls. The latter are once again missing an opportunity to permanently dominate the bears. Especially since this failure below $1700 would also coincide with a descending line which would prove tough to cross. A third straight week of consolidation would see the Tenkan break out towards the Kijun and $1400.
In the event of a throwback on $1400, the bulls should imperatively seize this chance, which itself could be the last to break the wall of $1700 (and also the descending line). With the possibility that the courses will make their big comeback inside the Kumo and rally $2300. At the same time, the Chikou Span would try to come back close to the descending line of the bear run.
Otherwise, if the bears manage to push down $1400, most of the rebound at the start of the year would be partly wiped out. We would therefore unfortunately go back to the support of $1200.
Ethereum in daily units – Courses now inside the Kumo
In daily units, the price of Ethereum has long delayed the deadline for several sessions. Much to the chagrin of the bulls, what had to happen happened. Because now, it descended slightly inside the Ichimoku cloud successively breaking down the Tenkan and the Kijun. Fortunately, the distance between prices and the $1400 support remains quite substantial as we speak.
However, the bulls would do well not to hang around at the risk of seeing the prince of cryptos accentuate his consolidation towards the lower limit of the Kumo, the Senkou Span B (SSB). This would mechanically send the Chikou Span into contact with $1400. And moreover, we would put a definitive end to the status quo of the price of ETH and the Chikou Span above the Kumo in daily units. In this sense, we would support the simultaneous rejection below $1700 and the falling line.
Assuming this bearish scenario materializes in earnest, the bears could return to business threatening $1400. And if the market context were to be overtaken by uncertainties, Ethereum would return to a support zone around $1200, which would once again weaken the bulls.
To make matters worse, we would not notice any real oversold signals on both the price dynamics and the gap between the Tenkan and the Kijun, to achieve this objective. Even a throwback to $1400 would not guarantee a long-awaited jump by the bulls given the thickness of the Kumo developing over the next few days.
Although nothing has been decided about the resumption or neutralization of its bear run since its last ATH in November 2021, be careful that the favorable momentum at the start of the year does not lose its momentum. The bulls will obviously watch yet another test at the contact of $1700. While the bears would begin to rekindle their flame in the event of a breakout of $1400.
But if the recent rises in the dollar and bond rates were to continue, the situation could change radically. For a question of credibility in its fight against stubborn inflation, the FED could raise key rates beyond its initial expectations.
Consequently, many investors who had priced in a pivot or change in US central bank monetary policy in the near future would risk being caught off guard. With an avalanche that could sweep over all the asset classes most vulnerable to liquidity, and more particularly cryptocurrencies. Thus, the recent failure of Ethereum price below the descending line of the bear run on a logarithmic scale would not be so trivial.
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