Ethereum has begun a recovery trend above the $2,800 level against the US dollar, but it must clear the $2,850 resistance level in order to continue higher in the short term.
Ethereum Encounters Resistance
Below the pivot mark of $2,850, Ethereum took a negative course. Even the $2,800 support level and the 100 hourly simple moving average were breached by ETH. Before the bulls emerged, it traded as low as $2,718. The price of Ether began an upward correction and surged above $2,750. The pricing was able to break through the $2,800 barrier. The significant slide from the $2,980 swing high to $2,718 low was clearly broken over the 23.6% Fib retracement level.
Furthermore, on the hourly chart of ETH/USD, there was a break above a major bearish trend line with resistance near $2,750. The currency pair is currently consolidating above $2,820 and the 100 hourly simple moving average. On the plus side, an initial resistance level is seen near $2,850. It is close to the 50% Fib retracement level of the massive decline from the $2,980 swing high to the $2,718 low. The next significant resistance is located near $2,880. A clear break above the $2,880 resistance level may signal the start of another uptrend. The next major resistance level could be $2,920. Any further gains could push the price towards the $3,000 resistance level in the near term.
A New Drop in ETH?
If Ethereum fails to break through the $2,850 resistance level, it may begin a new decline. On the downside, an initial support level is near $2,800.
The first major support is around $2,750. If the price breaks below the $2,750 support, it may return to the critical $2,720 support zone. Any further losses could pave the way for a larger drop towards the $2,650 or even $2,620 level.