Ethereum is facing growing selling activity since the recent breakout failed to sustain gains above $230. The correction that followed explored levels slightly under $220. However, the congestion of buyers in the zone has seen Ether renew the uptrend towards $225.
At the time of writing, ETH/USD is teetering at $224 amid a developing bullish momentum. The bulls require enough buying power and volume to clear the resistance towards $130. Unfortunately, technical levels are still unresponsive especially with the Relative Strength Index (RSI) stuck under the overbought region.
ETH/USD daily chart
On the brighter side, if the growth continues, then more and more buyers will be convinced to join the market. For now, the bulls must defend the support at $220 to ensure that any dips towards $200 are averted at all costs.
Another key bearish scenario is the formation of a double-top pattern. Unless the price advances above the next resistance at $230 and $240, Ethereum will remain in grave danger and at risk of diving back to $200. On the other hand, the pattern will function as support if ETH were to reverse from levels close to $300.
The fact that Ethereum is trading above the 200-day SMA, means that the bulls are largely in the driver’s seat. Therefore, investors should not panic due to the ups and downs in price movements, besides there is no bull market without pullbacks.
ETH/USD daily chart
Spot rate: $224
Relative change: 1
Percentage change: 0.45%
Trend: Bullish
Volatility: Low
Support: $220 and $200
Resistance: $230 and $240
