n

The Ethereum price has reached a significant support area. An increase towards the resistance line of the current pattern, without a breakout transpiring, would amount to a 30% price increase.

The Ethereum price has decreased by more than 15% in the past two days alone. This has caused it to reach a significant support area at $120-$125. The price has not reached this level since March 4, after which it began an upward move that lead to the 362$ high on June 26.

Cryptocurrency analyst and trader @loomdart stated that the current Ethereum price movement is nearing the point of maximum profit for longs.

Let’s analyze the price movement and see if this really is the case.

Ethereum Descending Channel

The Ethereum price has been trading inside a descending channel since July. It broke down below the $160 support area at the end of November, before validating it as resistance and continuing its downward movement. It has reached the $120-$125 support area.

The next support area is found at $100. If the price continues to decrease at the rate predicted by the wedge, it will reach it in February 2020. We discussed the longer-term chart in more detail in yesterday’s analysis.

Ethereum Support

If the price were to increase from the current price level all the way to the descending resistance line, it would amount to a 32% price increase. Measuring only movement inside the channel, this is the largest possible increase since the price reached the support line on November 25.

Hypothetically, if the price were to decrease to the second support area at $100, before moving towards resistance, it would indicate a 50% increase. Based on the slope of the channel, it should reach the support line in February.

Ethereum Rate Of Profit

Bitcoin Pair

Looking at the ETH/BTC pair, we can see that the price is trading inside a similar descending channel, and is currently at its support line.

While there is no bullish divergence in the RSI, it has fallen deep into oversold territory. The previous time it was this low, on September 6, a rapid upward move followed shortly after.

Ethereum

The long term chart suggests that it is possible that the current price is at the same point in its cycle as it was in February 2017, before the price broke out from a descending resistance line and continued the bull run until May of the same year.

This hypothesis is supported by the RSI, which generated bullish divergence slightly prior to the breakout, as it has done currently.

Descending Resistance

To conclude, the Ethereum price action shows that the price has fallen to the support line of a descending channel in both the USD and BTC pairs. While the former allows for a more gradual increase, the latter suggests that we are approaching the beginning of a new market cycle, characterized by a very rapid price increase.

The post Ethereum Price Is at the Point of Maximum Profit, According to Analyst [Premium Analysis] appeared first on BeInCrypto.

Source: Be In Crypto