Ethereum is currently consolidating above $460 over the past couple of days. On 15th November, the asset did re-test a low below $450 but now it looks lively again for a rally upwards. However, amidst such a bullish scenario, it continues to be difficult to ignore the bearish signs that were evident in the analysis.
Ethereum 12-hour chart
Observing Ethereum’s price direction since the middle of September, the major takeaway is its strong consolidation above the support of $365. This might go down to play a crucial role as the asset continues to ascend higher.
However, just like Bitcoin, Ethereum is currently due for a correction. Its movement within the ascending broadening wedge has registered adequate lower highs and higher highs with the pattern. While the trend remains strongly bullish on all sides of the market, Ethereum faces its last resistance at $489 before illustrating another new high for 2020.
There is no doubt Ethereum may rally forward in the coming weeks, but over the next week, if it fails to clear above $489, we might witness an earlier correction. A key bearish indication is thecurrent divergence taking place between its price movement and the trading volume.
Market Indicator indicated a similar outlook. Relative Strength Index or RSI indicated a bullish momentum, but sellers may lock in profits anytime in the markets. Awesome Oscillator is suggestive of a rising bearish momentum as red candles emerged in the chart.
Lastly, On-balance volume is currently over-exposed and reaching similar levels before the September collapse. As mentioned already, sellers are primed to take in profits at the moment.
Resistance: $489, $480
Support: $400, $440, $360
Entry for Long or Short: Risky to take any direction
Ethereum might be looking at a correction phase but it is still risky to enter a long or short position at the moment. Price Volatility is high and the pullback can take place at any price point.