At BeInCrypto, we offer regular price analyses and predictions of the most popular and relevant cryptoassets. In our Apr 9 analysis of Ethereum (ETH) we predicted that the price of Ethereum would decrease in the future. Our prediction was validated on Apr 10, when the price broke down from the wedge we defined. Learn more in our latest analysis of ETH/USD below:
On Apr 10, 2019, the price of Ethereum (ETH) made a high of $186.97. A sharp drop ensued which took it to lows of nearly $160 on Apr 12:
Has Ethereum found support at $160?
Let’s find out:
Ethereum (ETH): Trends and Highlights for April 11, 2019
- The price of Ethereum made a high of $186.97 on Apr 11.
- ETH/USD is following a descending support line.
- Bullish divergence is developing in the RSI and the MACD.
- There is resistance near $177 and $171.
- ETH is trading inside a long-term ascending channel.
In this section, we define Ethereum’s current trading pattern by analyzing the price of ETH on Bitfinex at one-hour intervals from Apr 9 to Apr 11.
On Apr 10, Ethereum reached an hourly low of $175.66. A gradual increase was followed by a decrease.
The price has made several lower lows. Tracing these lows gives us a descending support line:
Will Ethereum begin a reversal?
To find out, we need to take a look at technical indicators.
We begin with a look at the MACD and RSI.
The moving average convergence divergence (MACD) is a trend indicator that shows the relationship between two moving averages (long and short-term) and the price. It is used to measure the strength of a move.
The relative strength index (RSI) is an indicator which calculates the size of the changes in price in order to determine oversold or overbought conditions in the market.
Combining MACD and RSI bullish/bearish divergence with support/resistance essentially predicts price fluctuations.
They are shown in the chart below:
Similarly, the RSI and the MACD made the first low on Apr 10. However, they have continued to generate higher values since.
This is known as bullish divergence and often precedes price increases.
Using these indicators, it is likely that the price will begin to increase.
To determine possible price levels following an increase, we incorporate resistance areas into the analysis.
Support and resistance areas are created when the price revisits the same level several times. They indicate the levels price might reach in the future based on past patterns.
Two resistance areas are shown in the chart below:
The first resistance area is located near $171. The second one is found near $1177. If the price begins to increase, it is likely it will reach at least one of these areas. We believe this scenario is likely.
The closest support area is found near $156. If the price keeps decreasing at the rate predicted by the support line, it is likely to reach this area. Price may drop toward $156 before a rise toward the resistance areas.
So far, we have analyzed Ethereum’s short-term price fluctuation. To visualize the trading pattern over the last two months, Ethereum is analyzed from Feb 11 to Apr 11:
We can see that since Feb 11, the price of Ethereum has been trading inside an ascending channel.
We believe that the price will eventually drop to the support line of the channel.
Even though we predicted that there are going to be short-term increases, we should see a price decrease sometime next week as part of the long-term trend.
To read price predictions for 2019, 2020, and beyond, click the green button below:
Summary of Analysis
Based on this analysis, the price of ETH is likely to increase in the short-term and reach one of the resistance areas outlined above.
Do you think ETH will keep decreasing? Let us know your thoughts in the comments below.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.