Sep 5, 2020 10:02 UTC
Sep 5, 2020 at 10:02 UTC
Ethereum exhibited a strong momentum by the closing of the previous month, hovering above it’s previous 2020 high of $440 to setting up a new $475 2-year high giving the asset a fresh start for this month. Experts believe that the breaking of $440 high will set the next $500 barrier easy with further vision for $600 to $650 resistance. The second largest crypto currency is proving itself to be one of the best performing yet highly volatile within the crypto market amidst the others. By the time of writing, the asset is currently trading at $465 close to it’s $447 support for the week. Immediate selling pressure after the sudden high from traders looking for a profitable exit can be held responsible for the drop and the rest of the day might follow in the same direction.
SHORT TERM PREDICTION: ETH/USD
Examining from the technical levels, the Relative Strength Index (RSI) a momentum oscillator estimating the extent of latest price changes (Check: Investopedia ) currently holds up at 67% after indicating a slight overbought market yesterday, when the asset was trading at an unfair 2-year $488 high with the RSI moving close to 72%. It can be said, the typical pullback experienced after such condition is undertaking currently, as the measure is facing downwards suggesting the asset is likely to move in the favour of bears till the condition is settled.
Moving Forward, Moving Average Convergence Divergence (MACD) ( check: Fidelity) another momentum trend generating oscillator indicates that a sufficient buying is present to hold off the existing selling pressure from the previous weeks, for the coming days as the measure holds at +2.35 with the MACD line moving above the signal line, a sign in the favour of bulls.
Moreover, it can be noted that the MACD can be seen crossing above the signal line when the market closed at whooping $475 with a 9.67% spike in the price from the previous day suggesting that the bulls have an upper hand.
Furthermore, the divergence between the price and Shorter EMA (EMA 26) (check: Fidelity)
Can be seen reverting and giving a further heads up for a short uptrend.
The divergence was first notably visible when the asset closed at $398 touching a $405 high surpassing it’s previous $400 resistance , since then Ethereum can be seen hiking above the $400 resistance and closing at $428 to $433 ending the previous month at a very positive note.
Furthermore, it is clearly visible that the shorter moving average (EMA 26) is rising above the longer (EMA 50) which further proves the above theory that an incoming bullish trend is likely to occur.
Incorporating the above, it can be said that if Ethereum manages to keep above the $447 initial support over the mid-week an uptrend likely to set the asset closer to $490 resistance seems possible. On the other hand, price falling below $447 support over the same period might see a downfall till the next $415 support.
Key resistance level: $490, $520
Key Support level: $447, $415, $382
For More Short Term References: