The price of Ethereum (ETH) is in a downward correction as the price falls below the moving averages. Ether has been in an upward correction since the price collapsed on December 29.
The market has reached the overbought zone. The current upward move may fail at the recent high. In other words, Ether will be rejected at the blue line, the 21-day moving average. This will cause Ether to fall to the low of $3,436. However, if the current uptrend holds and the price breaks above the moving averages or $4,200, Ether will be out of the downward correction and the market will also move higher. In the meantime, the largest altcoin is facing resistance at the recent high.
Selling pressure may continue to the downside as Ether's price bars below the moving averages. The price of Ether is at level 44 on the Relative Strength Index for the period of 14. The largest altcoin is in a position to fall as it is below the midline 50. The market has also reached the overbought zone. Ether is above the 80% area of the daily stochastic. The uptrend might be short-lived as Ether is reaching the overbought area.
Major Resistance Levels - $4,500 and $5,000
Major Support Levels - $3,500 and $3,000
On the 4-hour chart, Ethereum is in a short uptrend. The Ether price has risen above the 21-day moving average line, but is encountering resistance at the 500-day moving average line. Meanwhile, the uptrend from January 1 has a candlestick body testing the 78.6% Fibonacci retracement level. The retracement suggests ETH will rise but reverse at the 1,272 Fibonacci extension or $3,845.17.
Disclaimer. This analysis and forecast are the personal opinions of the author and are not a recommendation to buy or sell cryptocurrency and should not be viewed as an endorsement by CoinIdol. Readers should do their research before investing funds.