Outlining Ethereum’s Future Movement as Bears Circle It
The Ethereum price has broken down from a long-term ascending support line.
Unless it is successful in reclaiming it, its price movement is considered bearish, with increases only serving to validate previous support levels from which Ethereum broke down from.
In the weekly chart, it is visible that the ETH price has successfully completed a double bottom pattern at the ₿0.017 area. This bullish reversal pattern was also combined with bullish divergence in the RSI, increasing its significance.
After initiating an upward move in the beginning of 2020, Ethereum validated the ₿0.0275 level, which previously acted as support. The price has been decreasing since.
The middle (EQ) of this range is found at ₿0.022, right at the level of the current price. It is not yet clear whether the price will flip this area as support or validate it as resistance. In order to figure that out, we need to take a closer look at lower time-frames.
Ascending Support Line
Since beginning an upward movement on Jan. 13, Ethereum has been following an ascending support line. However, the price broke down from this line on May 5 and has unsuccessfully tried to move above it since.
This is a bearish sign that suggests that the price has failed to sustain its upward movement and will soon decrease, most likely towards the ₿0.0185 support area.
Beginning in September 2019, we can outline a five-wave Elliott formation for Ethereum. In this case, the fifth wave is truncated, meaning that it failed to move above the wave-3 high.
The entire formation transpired inside an ascending channel which is created by linking the tops of wave 1 and 3. This channel successfully predicted the bottom of wave 4. Therefore, a breakdown from it is a sign that the price has completed its upward movement.
Unless the price reclaims this channel, it is likely to continue decreasing towards the previously mentioned ₿0.0185 support area and possible the bottom of wave 2 at ₿0.017.
An even more bearish chart was posted by well-known trader @TheEWGuy, in which he has outlined a five-wave formation since 2016. He states that the current downward move has not yet ended, and it will do so only after the price falls all the way to ₿0.01.
While we cannot state with certainty that Ethereum will decrease all the way to ₿0.01, it seems likely that the correction is not yet over and the price will decrease at least towards the support areas we have outlined above.
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Original Source: Beincrypto Outlining Ethereum’s Future Movement as Bears Circle It