$ETH Bounces Off Key Support: Reversal Ahead?

8 set

Ethereum Weekly Update

Ethereum (ETH) is showing a promising bounce from a significant support zone, ranging between $2,000 and $2,150. This area has acted as a key level of support since mid-2022, and it continues to hold strong. Additionally, this zone aligns with a crucial ascending support line that has supported the price for nearly two years.

On the 3-day chart, ETH has rebounded from a "golden pocket," a technical term that refers to a major support area in the price range of $2,150 to $2,200. Given the confluence of these factors, it's highly likely that Ethereum will maintain support in this range for the near term, although we need more confirmation to signal a full bullish reversal.

Looking at the daily chart, we’ve just seen the first sign of bullish divergence. This occurs when the price makes a higher low while the RSI (Relative Strength Index) does the same, indicating growing bullish momentum. We’ve confirmed this with one green candle close and a higher low on the RSI. If we see another daily candle close in green, it would give further confirmation of bullish strength.

However, despite these early signs of a possible reversal, the larger trend for Ethereum still remains bearish. This means that while we may see some short-term price relief or consolidation, we haven't yet confirmed a longer-term bullish trend. Over the next few days or even weeks, we could expect the price to either consolidate sideways or experience a small upward relief, but we need more signals to confirm a sustained uptrend.

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