Ethereum Price Drops Over 10% But Bulls Are Not Done Yet

Ethereum price rallied toward $3,850 before crashing. ETH followed Bitcoin, but the bulls are now active near the $3,350 support zone.

• Ethereum traded to a new multi-month high above $3,800 before crashing.
• The price is trading near $3,500 and the 100-hourly Simple Moving Average.
• There was a break below a key bullish trend line with support at $3,620 on the hourly chart of ETH/USD (data feed via Kraken).
• The pair could resume its increase if it clears the $3,600 resistance zone.

Ethereum price extended its rally above the $3,650 level, like Bitcoin. BTC surged and even traded to a new all-time high above $69,000. ETH also cleared the $3,800 level before the bears appeared.

There was a strong bearish reaction from the $3,827 high. The price crashed over $500 and traded toward the $3,200 support. There was a break below a key bullish trend line with support at $3,620 on the hourly chart of ETH/USD.

A low was formed at $3,211 and the price is now attempting a fresh increase. There was a move above the $3,500 level. The price climbed above the 50% Fib retracement level of the downward move from the $3,827 swing high to the $3,211 low. Ethereum is now trading near $3,500 and the 100-hourly Simple Moving Average.

Immediate resistance on the upside is near the $3,550 level. The first major resistance is near the $3,600 level or the 61.8% Fib retracement level of the downward move from the $3,827 swing high to the $3,211 low.

Source: ETHUSD on TradingView.com

The next major resistance is near $3,680, above which the price might gain bullish momentum.  The next stop for the bulls could be near the $3,820 level. If there is a move above the $3,820 resistance, Ether could even rally toward the $3,950 resistance. Any more gains might call for a test of $4,000.

If Ethereum fails to clear the $3,600 resistance, it could start another downside correction. Initial support on the downside is near the $3,440 level.

The first major support is near the $3,400 zone. The next key support could be the $3,340 zone. A clear move below the $3,340 support might send the price toward $3,220. Any more losses might send the price toward the $3,120 level.

Technical Indicators

Hourly MACD – The MACD for ETH/USD is losing momentum in the bullish zone.

Hourly RSI – The RSI for ETH/USD is now below the 50 level.

Major Support Level – $3,400

Major Resistance Level – $3,600