Ethereum Retraces On Below Average Volume: The Bull, Bear Case For The Crypto

Ethereum ETH/USD was edging about 1% lower during Tuesday’s 24-hour trading session after breaking up from a sideways pattern on Monday, which Benzinga pointed out Friday was likely to occur. 

The crypto was trading in tandem with Bitcoin, which was also retracing Tuesday after spiking up about 2% on Monday. Ethereum’s recent fluctuations in price have settled the crypto into an uptrend pattern on the daily chart.

An uptrend occurs when a stock consistently makes a series of higher highs and higher lows on the chart.

The higher highs indicate the bulls are in control while the intermittent higher lows indicate consolidation periods.

Traders can use moving averages to help identify an uptrend, with rising lower time frame moving averages (such as the eight-day or 21-day exponential moving averages) indicating the stock is in a steep shorter-term uptrend.

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The Ethereum Chart: Ethereum confirmed a new uptrend on Sunday and Monday by printing a higher low and a higher high, respectively. The higher low was printed at the $1,885 mark and the higher high was formed at $1,976.

• On Tuesday, Ethereum was dipping lower but on lower-than-average volume, which suggests consolidation as opposed to bearish price action. The crypto was also holding near Monday’s low-of-day without receiving momentum to the downside, which may give bullish traders more confidence.
• Tuesday’s consolidation has helped to drop Ethereum’s relative strength index (RSI) down from about 62% to 58%. If Ethereum continues within its uptrend, the crypto has room to move higher before the RSI reaches overbought territory above the 70% area.
• Bullish traders want to see big bullish volume come in and break Ethereum up above the psychologically important $2,000 mark. Bearish traders hope to see big bearish volume come in and drop Ethereum back down into the horizon pattern.
• Ethereum has resistance above at $1,937 and $2,150 and support below at $1,846 and $1,717.

Photo via Pixabay.