Ethereum Bounces at Nearly 500-Day Support
The Ethereum (ETH) price has recently experienced a bounce at a long-term ascending support trendline that has been in place for 473 days. This bounce occurred on September 11 and led to an increase in the ETH price. Additionally, Ethereum broke out above a shorter-term descending resistance trendline on September 28, reaching a high of $1,751 on October 1.
However, in the days following the breakout, the price has fallen along with the rest of the crypto market. It is important to note that after clearing an important trendline, prices often return to validate it as support before continuing their previous movement.
News and Developments for Ethereum
In recent news, nine Ethereum futures Exchange-Traded Funds (ETFs) were launched in the United States on October 2. However, these funds have seen underwhelming trading volume, accumulating less than $2 million. Grayscale has also filed an application with the Securities and Exchange Commission (SEC) to convert its Ethereum trust into an Ethereum ETF. Additionally, Ethereum’s founder, Vitalik Buterin, has highlighted concerns and benefits regarding adding more features to the core Ethereum software.
ETH Price Prediction: What’s Next?
An analysis of the ETH price movement reveals a significant bullish divergence in the RSI (Relative Strength Index) prior to the bounce. The RSI is used by market traders as a momentum indicator to determine overbought or oversold conditions and make decisions about buying or selling assets. A bullish divergence occurs when there is an increase in momentum accompanying a price decrease, often leading to bullish trend reversals.
If the current increase continues, ETH could reach its next resistance level at $1,820, representing an 11% increase from the current price. However, a close below the long-term ascending support line would invalidate the bullish structure and could result in a 12% drop to the next long-term support at $1,430.
Hot Take: Ethereum Bounces Back After Testing Support
The recent bounce of the Ethereum (ETH) price at a nearly 500-day ascending support trendline indicates resilience in the market. Despite a temporary decrease following a breakout, Ethereum has shown strength in returning to validate its support level. This bounce was accompanied by a bullish divergence in the RSI, suggesting a potential reversal in the trend. While there are mixed news and developments for Ethereum, including the launch of ETFs and concerns about adding more features to the core software, ETH’s future remains uncertain. Traders will be closely watching for further price movements and whether Ethereum can break through resistance levels or fall back to long-term support.
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