The Ethereum (ETH) price broke out from an important resistance level, but its rate of increase is trailing that of Bitcoin (BTC).
ETH is the native token of the Ethereum blockchain, created by Vitalik Buterin. It specializes in decentralized applications and smart contracts. Since March 10, there has been a rapid increase in the value of ETH. On March 17, ETH surpassed the $1,700 level and was confirmed as a strong support level after ten days (green icon). The daily RSI also showed positive signals, breaking out of its previous bearish trend and rising above 50, indicating a bullish trend and supporting the price increase.
Additionally, since June 2022, the price of ETH has been moving in an ascending parallel channel, although the channel’s support and resistance lines have not been fully validated. However, the channel’s midline has acted as resistance several times, indicating that the pattern is valid. On April 4, the ETH price broke out of the midline and rose significantly over the following 24 hours. If this trend continues, the price could reach the resistance line around $2,400.
Finally, if the entire movement inside the channel is an A-B-C structure. If waves A:C have a 1:1 ratio (white), this would lead to a high of $2,230, very close to the channel’s resistance line.
Despite these bullish signs, the entire bullish price forecast will be invalidated if ETH closes below the $1,700 area. In that case, a drop to the channel’s support line at $1,350 could follow.
Ethereum (ETH) Price Struggles Against Bitcoin (BTC)
The technical analysis for ETH/BTC shows an interesting development in the Bitcoin-Ethereum relationship. The pair has decreased inside a descending wedge since September 2022. The descending wedge is considered a bullish pattern, meaning an eventual breakout from it is expected.
Moreover, the ETH price trades just above the 0.618 Fib retracement support level at ₿0.063. This is the level that most commonly initiates reversals after corrections.
Finally, the 3-day RSI is nearly oversold. This level has previously initiated reversals (green circle). As a result, an eventual breakout from the wedge is the most likely scenario. If that occurs, ETH could increase to the next closest resistance at ₿0.077.
However, a breakdown from the wedge would invalidate this bullish ETH forecast. The price could fall to the ₿0.055 support area in that case.
To conclude, the Ethereum price trend is bullish as long as the price does not close below $1,700. While the digital asset is underperforming Bitcoin, it could soon break out from its bullish pattern and began a bullish reversal against it. In the ETH/BTC pair, the bullish outlook will be invalidated by a breakdown from the wedge.
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