Since dropping down to $3650 on December 15th, Ethereum has tested the $4000 resistance thrice over the past week. While there has not been any clear sign of bullish momentum yet, the asset has been forming higher lows over the past few days. Upon analysis, it was observed that the trend remains at the cusp of both bullish and bearish territory as Ether’s next direction may give more insight. At press time, Ethereum was valued at $3948 with a market cap of $472 billion.
Ethereum 4-hour chart
At the moment, Ethereum is currently moving within the trendlines of a symmetrical triangle. While this particular pattern has a 50% chance at both bullish or bearish breakout, on further observation, it is also forming a bearish pennant. From its ATH level of $4864, the asset is currently just above its 0.50 Fibonacci level, which is a good sign. Now, in order to build on this momentum, Ethereum needs to consolidate above the $3894 range at all times.
A break above $4100 will allow the asset to build on a fresh bullish rally as the downtrend will undergo a reversal.
Market Indicator
At press time, the Relative Strength Index or RSI is tapering in the chart which indicates a lack of significant strength from the buyers. When the other market indicators were compared, Stochastic RSI pictured a bullish crossover, indicating a possible recovery sign. MACD on the other hand completed a bearish crossover, suggesting that the momentum is still with the sellers.
Lastly, On-balance Volumes indicated consistent selling action since December 6th, and an uptick would probably kick things in the upwards direction for Ethereum.
How to invest in Ether right now
At the moment, the price is neither bullish nor bearish. While bullish signs have been observed, bears maintain a grip on the market and investors should be looking at a buying opportunity once the value of ETH is above $4100. That would establish a reversal in a downtrend, and open up further re-test of resistance at $4300-$4400.