The exchange rate Ethereum (ETH) is trading in the middle of a long-term pattern. The further trend of the price depends on whether it makes a bounce or a bearish breakout
The weekly and daily charts give mixed signals. This does not make it clear whether Ethereum (ETH) will be able to launch a rally or continue to decline.
Ethereum peeked above resistance
ETH is the native token of the Ethereum blockchain, co-founded by crypto industry heavyweight Vitalik Buterin.
In the fall of 2022, the entire project migrated from the energy-consuming consensus mechanism Proof-of-Work (PoW) to the algorithm Proof-of-Stake (PoS), which was a significant milestone in Ethereum history.
In April 2023, the network successfully updated Shapella. The upgrade implemented EIP 4895, which allowed for the withdrawal of stacked ETH from the Beacon Chain.
In the course of the upgrade, the EIP 4895 proposal was implemented.
As the results of technical analysis show, some signals point to a bullish trend. So, the rate of ETH has made a break of the descending resistance line, built from the historical maximum.
That could bode well for the coin to end its previous trend and start a new one, in the opposite direction.
In addition, the weekly Relative Strength Index (RSI) is also showing bullish signals, holding above 50.
This index is a momentum indicator, indicating overbought/oversold markets, depending on whether it is above or below the 50 mark.
On the other hand, however, Ethereum dipped below the $1900 horizontal area, turning it into resistance again (red icon).
So the previous bullish breakout should be seen as a deflection (red circle). This is already a bearish signal and promises a decline.
ETH: rebound or bearish breakout
The shorter daily timeframe indicates that the price is now trading near a key level which could determine the further direction of the trend.
ETH is trading directly above the midpoint of a long-term rising parallel channel. Now this midline acts as support (red circle).
If the price rebounds from here, it can go to the $2400 channel resistance line.
In the meantime, a break-down of the midpoint could trigger a fall towards the support line of the channel at $1400.. Nearby there is also the previously highlighted area of horizontal support.
In addition, the daily RSI is below 50 (green circle).
In addition, the daily RSI is below 50 (green circle), which also indicates an advantage for the bears.
If ETH continues to decline, it could sag to the nearest support at $1600. Meanwhile, the next resistance is around $2550.
So the behavior of ETH near the midline of the channel will set the vector of further movement in the market.
A rebound from that line could push the price to the highs near $2500, and a bearish break of that line could trigger a decline to $1500.