Ethereum (ETH), the second largest cryptocurrency by market capitalization, recently saw its price fall below its 4-hour simple moving average (SMA). The 4-hour SMA is often used to measure short-term market momentum, so this technical development is noteworthy for traders and investors.
If the price of a cryptocurrency falls below this moving average, it could be a sign that market sentiment is likely to change from bullish to bullish. bearish. This could mean selling pressure increases and the downtrend may continue. The implications of these price movements extend beyond technical analysis, as broader market conditions, investor behavior, and fundamentals will play a significant role in shaping Ethereum’s future trajectory.
In this article, we will look at the potential price action of ETH with the help of technical indicators.
Ethereum price conditions on 4-hour chart
First, we can see that the 4-hour ETH price has been trading sideways for a while and then fell below the 100-day SMA. It is important to note that when an asset falls below its SMA, in most cases this can mean: Short-term or long-term movement in that direction.
Additionally, the Relative Strength Index (RSI) indicator confirms that Ethereum may move in a downward direction for some time, as the RSI line may cross below 50% and show a bearish trend for some time.
Looking at the daily chart, we can see that Ethereum is attempting to rise towards its 100-day SMA after dropping a bearish candle the previous day. At this point, one could suggest that ETH moves lower to test the 100-day SMA before rising again.
Lastly, the RSI indicator’s RSI line is currently falling towards 50% of overbought territory, which indicates that ETH still has room to fall.
ETH price outlook
Ethereum is currently attempting a downward move towards its daily SMA, if it falls below it will continue its downward move towards the $2,865 support level. Additionally, a drop below the aforementioned level could lead to a further drop to test the $2,147 support level.
However, if ETH price touches the SMA and then bounces, it will head higher towards the $4,099 resistance level. Additionally, if it falls below this resistance line, it will continue to rise and test the $4,863 level. ETH A rise above the $4,863 level could lead to a new high.
At the time of writing, ETH was trading at around $3,694, up 0.41% with a market capitalization of over $443 billion and 24-hour trading volume of over $18 billion. The previous day’s market capitalization decreased by 2.97%, while trading volume increased by 39.28%.
Featured image from iStock, chart from Tradingview.com
Source: NewsBTC.com