Ethereum Price Analysis: ETH/BTC Creates a Triple Bottom

At the time of writing, it was trading at ₿0.026. Will the ETH price break down? Below, we are going to look at ETH in different time-frames alongside technical indicators in order to answer this question. For our previous analysis, click here. If you would like to trade Ethereum (ETH) safely and securely on our partner exchange, follow this link to get all set up on XCOEX.

Ethereum Price: Trends and Highlights for July 5

• ETH/BTC is trading inside a significant support area.
• There is a long-term bullish divergence developing in the RSI and the MACD.
• The price is trading inside a descending channel.
• It has made a triple bottom pattern.

ETH Price: Long-Term Divergence

The price has reached the ₿0.025 support level on four occasions:

• September 2018
• December 2018
• May 2019
• July 2019

However, the RSI and the MACD reached a low on December 2018. Since then, they both have been increasing. This is known as bullish divergence and often precedes price increases. This level of divergence inside a long-term time frame is not very common. Therefore, the ensuing upward move could be quite notable.

Descending Channel

Since the beginning of 2019, the Ethereum price has been trading inside the descending channel outlined below. The movement inside the channel has been characterized by rapid increases and gradual decreases. After touching the support line, the price has initiated an upward move towards the resistance line. This occurred most recently on May 13. At the time of writing, the ETH price was trading in the middle of the channel.

Triple Bottom

While inside the channel, the price has apparently made a triple bottom, which is considered a bullish reversal pattern. ETH made a low of ₿0.025 on May 13, 25 and July 4. An upward move that reached the resistance line began soon after a low was reached on May 13. The same thing transpired on May 25, but the ensuing upward move was significantly weaker. In order to determine whether another upward move will follow, we will use the RSI. Since May 25, a bullish divergence has been developing in the RSI. Combined with the analysis from the previous section, this makes us believe that the ETH price will not drop to the support line. Rather, it is likely to initiate an upward move from the current level.

Alternative Scenario

However, the most recent price movement since May 13 also has similarities to the Cup and Handle, which is considered a bearish pattern. However, we do not believe this is likely for the following reasons:

1. A breakdown would cause the price to decrease rapidly, invalidating both the support area and the descending channel.
2. The long-term bullish divergence.
3. The short-term bullish divergence.

However, if the ETH price begins to decrease below ₿0.024, it could initiate a rapid drop towards ₿0.01, levels not reached since the beginning of the upward move in May 2017.

Summary

The Ethereum price is currently trading inside a very significant support area. The readings from the momentum indicators and recent price movement make us believe that it will soon initiate an upward move. Do you think the Ethereum price will soon begin an upward move? Let us know in the comments below.

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Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.  Images are courtesy of Shutterstock, TradingView.