FX.co ★ Ethereum shows strong overbought signs

Ethereum plunged after failing to reach the 4,380.64 all-time high. It has increased as high as 4,375.00 in yesterday's session where it found resistance. At the moment of writing, it was traded at 3,941.51 above 3,886.00 today's low.

The crypto stands above the dynamic support and the immediate uptrend line, so the bias remains bullish despite the current sell-off. ETH/USD registered an 11.18% drop from yesterday's high to today's low. Technically, the price of Ethereum could test and retest the immediate support levels in the short term.

ETH/USD under massive pressure

As you can see, ETH/USD is trapped within an ascending channel pattern. As long as it stays within this pattern, the crypto could start increasing again. Unfortunately, it has dropped below 4,025 and under the ascending pitchfork's upper median line (uml) signaling strong pressure.

The uptrend line and the 3,800 yesterday's low are seen as downside obstacles. A false break below these levels or any other bullish pattern may announce a new leg higher. Yesterday's pin bar, the huge spike down, signaled that the buyers are still strong in the short term.

Ethereum forecast

Coming back and stabilizing above 4,025 and above the ascending pitchfork's upper median line (uml) could signal that ETH/USD could try to climb towards the all-time high. Bitcoin's growth after its retreat could help Ethereum to grow as well.

Personally, I believe that only a valid break below the uptrend line and a new lower low could announce a larger correction and could invalidate a potential upside continuation.