ETH Technical Analysis: The best support of the major bull cycle has been reached

When the Bitcoin price fell below $40,000, ETH also made a low below $3,000. Here are a few updates and views from an ETH technical analysis perspective.

A drop to the $3,000 zone is predictable

If you have read the article “Ethereum Technical Analysis: Over 10% Down, Close to Critical Support”, then this panic sell scenario to the $3,000 zone was predicted and planned in advance. As such, the price has come close to exactly what was predicted and has officially hit the best support of a major bull cycle.

phan tich ky thuat ETH ema50 w1 1024x843 1

  • It can be seen that the entire growth cycle of the ETH price over the past 2 years is supported above the EMA50 of the 1W frame. The deepest dumps also only approached this EMA50, not falling deeper.
  • This week was the first time ETH price fell below the EMA50 but quickly recovered above $3,000. By this logic, we can predict the $3,000 price zone as the last stop of a correction.

That is, conversely, if the price sideways around the EMA50 and volatility lowers, more negative scenarios will open up.

Bad signals need to be noted

First, one of the bad signals right now is that Bitcoin Dominance (BTC.D) is rising again.

BTC.D tang bat loi cho ETH Altcoin 1024x820 1
BTC.D tends to increase again the past few days.

Although there was a time when BTC.D dropped below 40%, it quickly recovered and opened a bullish signal for the coming days (touching the trendline).

  • Normally, during a bear market, Bitcoin will always present itself as the “King” and regain its position. Because then investors will restructure their portfolios and give preference to stronger cryptocurrencies.
  • However, ETH is different from the past. You can read more about “ETH Dominance surpasses 20%, Bitcoin throne at stake?” for more different perspectives.

Second, bad signal comes from MACD-H crossover in 2W frame.

According to MACD-H technical analysis, when MACD Line crosses Signal like this, the two lines will tend to move towards 0 point and MACD Line will touch first. Currently, not only the two lines are intersecting, but they are also very far away from the 0 point level, reaching nearly 700 points.

phan tich ky thuat ETH MACD w2 1024x843 1
ETH technical analysis 2W frame with MACD-H.
  • In the short term, the ETH price is identified with the following key levels:
    • Support: 3,000 USD
    • Resistance: 3,400 USD
  • ETH needs to recover from this $3,000 zone closing a 2W candle (mid-January) above $3,400. Thus the probability for a price increase again will be higher. At that time, a red negative histogram will be avoided as happened in June-July.

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