Ethereum (ETH), the second-largest cryptocurrency by market cap, recently saw its price fall below the 4-hour simple moving average (SMA). This technical development is noteworthy for traders and investors, as the 4-hour simple moving average is often used to measure short-term market momentum.
When the cryptocurrency price falls below this moving average, it may indicate a potential shift in market sentiment from bullish to bullish. bearish. This could mean increased selling pressure and a continuation of the potential downtrend. The implications of this price action extend beyond technical analysis, as broader market conditions, investor behavior and fundamental factors also play a crucial role in shaping Ethereum's future path.
In this article, we will explore the potential price action of ETH with the help of technical indicators.
Ethereum price status on the 4-hour chart
Firstly, it can be seen that ETH price in the 4-hour time frame has seen a decline below the 100-day simple moving average after moving in a consolidation manner for a while. It should be noted that most of the times when the price of an asset falls below the simple moving average (SMA), this may indicate that A short or long term move in that direction.
In addition, the Relative Strength Index (RSI) also confirms that Ethereum may be moving in a downtrend for a while as the RSI line has crossed below 50% and could trend there for a while.
From the daily chart, it can be seen that Ethereum is trying to move towards the 100-day simple moving average after dropping a bearish candle the previous day. At this point, ETH's decline could be suggested to test the 100-day simple moving average before making an upward move again.
Finally, the RSI line of the RSI is currently falling from the overbought zone towards 50% indicating that there is still room for ETH to move lower.
ETH price forecast
As of now, Ethereum is trying to move lower towards the daily simple moving average (SMA), and if it drops below that, it will continue to move lower towards the $2,865 support level. Moreover, it could fall further to test the $2,147 support level if it falls below the above-mentioned level.
However, if ETH price touches the simple moving average and bounces back, it will move upwards towards the $4,099 resistance level. Also, if it breaks below this resistance level, it will continue higher to test the $4,863 level. Ethereum It may move to create a new high if it rises above the $4,863 level.
As of the time of writing, ETH price was trading at around $3,694 and was up 0.41% with a market cap of over $443 billion and a 24-hour trading volume of over $18 billion. Its market value decreased by 2.97%, while its trading volume increased by 39.28% in the past day.
Featured image from iStock, chart from Tradingview.com