Ethereum’s uptrend is looking strong as it attempts to regain ground above $3,400. A key ascent above the daily 50-SMA (yellow) would put the alt leader back at the helm on of an ascending channel pattern. At the time of writing, ETH traded at $3,075, up by 7% over the last 24 hours.
Ethereum Daily Chart
Ethereum bulls responded to a 13.5% drawdown between 10-14 February by hitting back at the combination of the daily 20-SMA (red) and the baseline at $2,840. With a breakdown out of the way, the price can march forward to the upper limit of a supply zone, residing at $3,420, and the daily 200-SMA (green), present around $3,570. However, bulls have to work past the daily 50-SMA (yellow) and 78.6% Fibonacci level, both of which can put an early halt to the bullish progress. Nevertheless, bears would have to hard time denying ETH the key breakout.
The daily RSI has established support around 50 and now looks forward to continuing its uptrend heading forward. The same would supplement more buy orders until the RSI hits overbought territory. Furthermore, a bullish crossover on the Directional Movement Index, its first in 11 days, backed a favorable outlook as well.
However, it’s worth noting that the MACD was trading below the half-line and a bearish crossover was not fully negated just yet. If the crossover combines with a breakout rejection at the 50% Fibonacci, ETH would likely revisit the lower trendline around $2,900. A resulting breakdown would allow bears to exert losses to $2,634 or even $2,300 in a severe outcome.
Conclusion
Ethereum awaits one final breakout to regain access above $3,400. A move past the 78.6% Fibonacci would likely result in a new high at the upper trendline. However, investors can expect a correction once the daily 200-SMA (green) comes into play.