ETH struggles to find direction

  • Ethereum price action shows little has changed from the open.
  • Inside bar on the daily chart can present opportunities.
  • The price range for a breakout trade in either direction is tight.

Ethereum price action is very constricted during today’s trading. A primary reason for this consolidation goes beyond the volatility of yesterday’s trading. There is a very tight $100 range above and below the $3,400 value area where Ethereum has a near equal opportunity to surge higher or plummet lower. 

Ethereum overall trend favors the bulls, but bears have a strong case for a sell-off

Ethereum bulls have several technical factors favoring a resumption of the prior uptrend – the most important is the Chikou Span remaining above the candlesticks. The Relative Strenght Index is parked right on top of the first oversold condition in a bull market (50). The Composite Index has an almost imperceptible hidden bullish divergence level. To fulfill an apparent resumption of the move higher and move to new all-time highs, bulls need to push Ethereum’s price to a close above $3,530.

There will be a likely test of new all-time highs if bulls break the near-term resistance, setting up for a test of $5,000 and even higher. 

ETH/USD Daily Chart

Bears need to push Ethereum below $3,400. There is a significant volume trough in the Volume Profile between $3,400 and $3,000. The most important technical indicator that will display a clear likelihood of lower prices is the Chikou Span closing below the candlesticks, which is right on the $3,000 Ethereum price level.

Unless something dramatic happens near the end of the trading day, Ethereum looks poised to maintain a very constricted trading pattern. If the current daily high ($3,540.10) and low ($3,218.20) remain, then tomorrow’s trading setups will be established according to the inside bar formed today. Bulls will have a very bullish entry above today’s high, but bears will need to target an entry below the Tuesday low ($3,026.00)

Ethereum bulls will find primary resistance at $3,900, while Ethereum bears will find strong support against the top of the Cloud (Senkou Span A) at $2,288.