Ethereum Recovers, Close Above $392 Could Spark A Strong Rally

Ethereum’s ether stayed above the $372 support and recovered nicely against the US Dollar. ETH price is now struggling to clear $392, above which it could rally significantly.

• Ethereum started a decent recovery wave after it found support near the $372 level.
• The price is now trading above $382 and testing the 100 hourly simple moving average.
• There was a break above a key connecting bearish trend line with resistance near $384 on the hourly chart of ETH/USD (data feed via Kraken).
• The pair must settle above $392 to initiate a strong rally in the coming sessions.

Ethereum Price is Attempting Upside Break

After diving towards the $372 support, Ethereum held the ground and started a decent upward move. ETH price broke the $380 resistance level to move into a short-term bullish zone.

The upward move was such that ether price surpassed the 23.6% Fib retracement level of the downward move from the $404 swing high to $371 swing low. Moreover, there was a break above a key connecting bearish trend line with resistance near $384 on the hourly chart of ETH/USD.

The price is now facing hurdles near $388 and $390. The 50% Fib retracement level of the downward move from the $404 swing high to $371 swing low is also acting as a resistance. It is now trading above $382 and testing the 100 hourly simple moving average.

Source: ETHUSD on TradingView.com

To start a strong rally, ether must clear the $390 resistance and then settle above $392. A successful close above the $392 resistance may perhaps initiate a larger upward move (similar to bitcoin if it clears $14,000) towards the $405 and $412 levels. Any further gains could lead the price towards the $420 resistance level.

Downside Limited in ETH?

If Ethereum fails to clear the $390 and $392 resistance levels, it could react to the downside. An initial support on the downside is near the $382 level.

The first major support is near the $380 level. A clear break below $380 could start another decline towards the main $372 support level. Any more losses is likely to push ether towards the $365 level in the coming sessions.

Technical Indicators

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

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

Major Support Level – $380

Major Resistance Level – $392

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