Ethereum is Plunging, But It’s Too Early to Say Bulls Have Given Up

Ethereum is down more than 6% and it broke the $235 support against the US Dollar. ETH tested the $228 support zone and it is currently correcting higher.

• Ethereum declined sharply after it failed to surpass the $250 resistance.
• The price is currently holding the $228 support, but it is well below the 100 hourly simple moving average.
• There was a break below a major triangle with support near $244 on the hourly chart of ETH/USD (data feed via Kraken).
• The pair is currently correcting higher and it might face sellers near the $235 zone.

Ethereum Price Drops 6%

Yesterday, Ethereum faced a strong rejection near the main $250 resistance against the US Dollar. ETH price formed a high near the $250 level and recently started a sharp decline below $245.

The recent drop was initiated after there was a break below a major triangle with support near $244 on the hourly chart of ETH/USD. It opened the doors for more losses below the $240 level and the 100 hourly simple moving average.

Ether price even broke the key $235 support and traded close to the $225 support. A low is formed near $228 and the price is currently correcting higher. It is approaching the 23.6% Fib retracement level of the recent decline from the $250 swing high to $228 low.

Ethereum price trades below $235. Source: TradingView.com

On the upside, there is a crucial resistance forming near the $235 level (a multi-touch zone). If Ethereum closes above the $235 resistance, it could test the 50% Fib retracement level of the recent decline from the $250 swing high to $228 low at $238.

Any further gains may perhaps open the doors for a fresh increase towards the significant resistance at $250 in the coming sessions.

Breakdown Support for ETH

On the downside, the $228 and $225 levels are important supports. If Ethereum fails to stay above the $225 support, it will negate the chances of a near-term recovery.

In the mentioned bearish case, the price is likely to continue lower below the $220 level. The next major support is near the $215 level, where the bulls may take a stand.

Technical Indicators

Hourly MACD – The MACD for ETH/USD is slowly moving in the bullish zone.

Hourly RSI – The RSI for ETH/USD is now just below the 40 level, with a bearish angle.

Major Support Level – $225

Major Resistance Level – $235

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