On July 16, 2019, the Ethereum price reached a low of ₿0.0201. An upward move followed. ETH reached highs of ₿0.0223 on multiple occasions. It has been decreasing since. On August 6, it reached a low of ₿0.0190.
Did Ethereum reach the bottom on August 6 or will it continue to decrease? In order to answer that question, we will analyze the Ethereum price in different time-frames alongside technical indicators.
For our previous analysis, click here.
Ethereum Price: Trends and Highlights for August 7
- ETH/BTC is possibly trading inside a descending channel.
- There is support at ₿0.017
- Short-term moving averages have made a bearish cross.
- The RSI has broken down from a significant trend line.
Current Pattern
A look at the six-hour time-frame shows that the Ethereum price has been following a descending resistance line since July 8.
Since there is no clearly visible support line, we have drawn one parallel to the resistance line, which gives us a descending parallel channel.
The second possibility is that the support line is less steep in slope, and the Ethereum price is trading inside a descending wedge instead.
Since none of the support lines are validated, we will assume the first scenario in the rest of the analysis.
Staying within the same time-frame, a look at the moving averages supports a continuing decrease towards the support line.
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A bearish cross between the 10- and 20-period MAs occurred on July 30.
This coincided with the price touching the resistance line.
Since then, the Ethereum price has been decreasing, facing very close resistance from the 10-period MA.
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Signs Of Weakness?
A look at the daily RSI shows that the price has been generating bullish divergence since June 24.
However, the upward sloping trend line of the divergence was broken on August 5.
This can be considered a bearish sign, supporting further price decreases.
If the Ethereum price continues to decrease, the closest support area is outlined below.
It is found at ₿0.017.
This area coincides with the support line of the descending channel outlined in the first section.
Another reason that we believe the price will decrease is the horizontal support line at ₿0.025.
It has provided support to the Ethereum price since December 2017, for roughly one and a half years.
Sponsored SponsoredSince it finally broke down, we do not believe the price will immediately increase above it.
Whenever the price begins another upward move, the previous support line should provide very strong resistance.
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Ethereum Price Summary
The Ethereum price has been decreasing, possibly trading inside a descending channel.
According to our analysis, it is likely to continue doing so until it reaches the support area outlined above.
Do you think Ethereum will reach the support area? Let us know in the comments below.
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 TradingView and Shutterstock.
