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Previously on U.Today, we covered Ethereum's movement on the market, as the second biggest cryptocurrency reached the fundamental support line, which has acted as a foundation for rallies on Ether since summer 2021. Luckily, the support line played out in favor of the bulls once again.
According to the daily chart of the asset, ETH has successfully bounced off the aforementioned support line and is currently moving towards the next major resistance, which would be $2,000 as it acts as a psychological threshold for traders and investors.
In addition to the "round numbers" resistance, it is most likely that traders who got into Ether at around $2,000 would try to breakeven on their positions, selling close to or directly at the price. Such a tendency creates massive pressure on the rising asset and may interfere with its path to a new local high.
Foremost, Ethereum has to breakthrough the downtrend formed since May 15 before entering another rally. According to volume profiles, traders and investors are not rushing to support the current movement on the second biggest cryptocurrency on the market.
Technical indicators do not seem to show any type of market signal as the volatility on Ethereum and other cryptocurrencies remains relatively low.
The only distinguishing signal we can clearly see right now is the strong divergence on the Relative Strength Index. Usually, divergences are heralds of an upcoming reversal or a bottom. In the case of Ethereum, we are already seeing a realization of the signal.
At press time, Ether trades at $1,875 and is losing part of the growth it obtained since the beginning of the week. The cryptocurrency is yet to break the upcoming trendline support to move further up.
Godfrey Benjamin
Gamza Khanzadaev
