Wed, Mar 29, 2023 @ 07:33 GMT
HomeContributorsTechnical AnalysisETHUSD Edges Lower, Bulls Continue to Vie for a Breakout Above 1,700

ETHUSD Edges Lower, Bulls Continue to Vie for a Breakout Above 1,700

ETHUSD is edging lower today following three days of advances that pushed it momentarily above the 1,700 area. It remains inside the nicely shaped 1,500-1,710 rectangle that has formed since January 16, in line with the 23.6% Fibonacci retracement level of the April 4, 2022 –June 18, 2022 downtrend of 1,510. ETHUSD made unsuccessful attempts to break down the rectangle on both the downside and upside, but the market appears to be in a fine balance at the moment. Market participants would prefer a decisive close outside the rectangle boundaries in order to make an informed decision about the next move.

The momentum indicators have acknowledged the recent upward move. The RSI has edged above the 50 midpoint with the downward sloping trendline now acting as support. Additionally, the stochastic oscillator is moving higher almost in a vertical fashion and thus revealing the strength of the current move.

If the bears manage to push ETHUSD towards the 1500s area, they would be faced with both the lower boundary of the rectangle and 50-day simple moving average (SMA). If successful in breaking these levels, the next target could be at the 1,365-1,442 range, populated by the 200- and 100-day SMAs. Even lower, the 1,262 level set by multiple lows and highs during 2022 could prove tougher to crack.

On the other hand, the bulls appear to be perplexed by the resistance met at the 1,700 area as their attempts to overcome it in the past six months have failed. Should they manage to break this level, they could test the January 4 upward sloping line just ahead of the September 11 high of 1,790. Even higher, the 38.2% Fibonacci retracement at 1,907 could prove to be a stronger resistance point.

To sum up, ETHUSD continues to hover inside the recent rectangle. The bulls would love a move above the 1,700s area while the bears hope for a repeat of the move seen during the September-November range trading episode.
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