Ethereum hits one of main resistance lines on daily chart, but it might not break it that easily
Ethereum is finally reaching one of the first resistance lines on the chart which acts as a barrier for assets in the uptrend and downtrend. Along with hitting resistance, Ethereum could be set for another rally, depending on a variety of technical indicators.
Third time is not a charm
Since the beginning of May, Ethereum had tested the 21-day moving average three times and failed to break through due to a variety of factors, including outflows of funds from the cryptocurrency market and increased investment risks.
For now, Ethereum is preparing for another test which would be the fourth in the past two months. Such a high number of resistance tests could indicate that the bulls are still unable to push Ethereum higher due to the lack of inflow into the market.
Some metrics suggest that downtrend is over
The Relative Strength Index on the daily chart is one of those indicators that hint at a reversal on Ethereum. According to the divergence we saw previously, the downtrend on ETH could be over, and what we see now is a consolidation before the recovery rally.
Another indicator that speaks for an upcoming retracement is the volume profile which shows a noticeable discoloration from the current trend, as daily trading volume on the Kraken exchange hits 13,000 ETH from the 30-year average. 000 ETH.
On shorter timeframes, Ethereum has already broken through numerous resistance lines, including 50EMA on the four-hour timeframe. The successful passage through shorter term resistance is one of the first signs of an upcoming long-term reversal.
At press time, Ethereum is changing hands at $1,130.
