Ethereum is making a move back towards the $407 level of resistance this morning following a notable bounce from the $383 level of support.
The recovery to the upside comes after a sharp 9.31% plunge on Friday as Ethereum was met with a second rejection from $440 in as many days.
The world’s second largest cryptocurrency in terms of market cap is now at a key pivot point, break above $407 in the short term and it will likely form a new yearly high in the coming weeks, while forming a lower high could be the initial signs of a reversal.
A head and shoulders pattern also seems to be developing with Ethereum, with the left shoulder, head and neckline all tying in with the volume profile to form the ominous reversal signal.
If the right shoulder plays out as expected, a measured move from a head and shoulders would see Ethereum slump to as low as $285, which was also the previous yearly high in February.
However, this theory will only come into fruition if Ethereum fails to break above $407, which will likely be decided tonight when the daily candle closes.
Much of the upcoming price forecast will also depend on the direction of Bitcoin as it attempts to re-establish the bullish control zone above $12,000.
If Bitcoin begins to move up to re-test the bitter $12,500 level of resistance, Ethereum will likely follow back above at least $430.
For more news, guides and cryptocurrency analysis, click here.
Ethereum was launched by Vitalik Buterin on July 30 2015. He was a researcher and programmer working on Bitcoin Magazine and he initially wrote a whitepaper in 2013 describing Ethereum.
Buterin had proposed that Bitcoin needed a scripting language. He decided to develop a new platform with a more general scripting language when he couldn’t get buy-in to his proposal.
More Ethereum news and information
If you want to find out more information about Ethereum or cryptocurrencies in general, then use the search box at the top of this page. Please check the below article:
As with any investment, it pays to do some homework before you part with your money. The prices of cryptocurrencies are volatile and go up and down quickly. This page is not recommending a particular currency or whether you should invest or not.
Disclaimer: This is not financial advice.