On May 28th, a notable increase in the crypto market allowed the Ethereum price to surpass the descending resistance trendline of the wedge pattern. This was indicative of buyers trying to regain control of the trend and initiate a sustained recovery. However, the struggle to maintain above the breached trendline raises concerns about a false breakout scenario and potential decline.
The Ethereum price is currently retesting the recently reclaimed trendline to determine if it can support higher levels. A drop below this descending trendline would suggest the resumption of the previous correction phase. The intraday trading volume for Ether has seen a 34% gain, reaching $6.2 billion.
At present, Ethereum is trading at the $1,871 mark, with an intraday loss of 1.58%. The long red candle displayed alludes to an attempted breakdown from the recently reclaimed trendline, showing that sellers aren’t backing down just yet. However, should the candle close below the combined support of $1,870 and the descending trendline, a bull trap scenario would occur, intensifying the selling pressure in the market. A decline below the trendline would continue to liquidate aggressive buyers, with their forced sell orders further fueling downward momentum.
This post-breakdown fall could see the Ethereum price drop to $1,770, followed by the $1,715-$1,700 range. On the flip side, if the coin price proves sustainable above the trendline by the day’s end, the uptrend potential for Ethereum, as discussed in our previous article, will remain intact.
However, a potential breakdown below this trend would bring market sellers back into the Ethereum price. The breached trendline would then serve as significant resistance for short selling, with a high likelihood of plunging the price toward the critical support zone of $1,770.
It’s worth noting that the Relative Strength Index’s daily slope reversal from the 60% mark reflects a lack of buyer strength to maintain a strong momentum rally. Additionally, the Supertrend’s red film projection signifies that the overall market trend is bearish.
The content presented here may include the author’s personal opinion and is based on market conditions. It is crucial to conduct market research before investing in cryptocurrencies, as the author or publication holds no responsibility for personal financial loss.
Source: Coingape
