- Despite dominant red tide, Ethereum forming bullish pennant
- RSI has successfully left the oversold zone and is in an ideal buying position
The market is still dyed red. Bitcoin and other main cryptocurrencies in the ecosystem are still shedding out losses, with the exception of some currencies. The market capitalization of the entire crypto market has fallen to $ 177.47 billion, with a significant loss of -5.68% in the last 24 hours.
90% of cryptocurrencies are in the red zone as the trading volume specially anchored to BTC increases by + 16.98% to $ 72.52 billion, making the market-leading cryptocurrency increase its dominance above 67.07% (+ 0.43%).
Despite the great dominant red tide, some altcoins within the top ten are beginning to show some signs that could indicate a possible change of pattern in the next few days. Undoubtedly, a great buying opportunity is what we are witnessing on the eve of the Christmas holidays.
Such is the case of Ethereum. The altcoin market leader at the time of writing quotes at a price of USD 123.01 with a significant loss of -7.49% that has taken ETH to unwanted levels of December 2018 when the cryptocurrency fell below the $ 100 price.
However, the 1H chart of ETH\USD pair on Binance simply shows the descending channel had a wedge breakdown, but it resulted in the formation of a Bullish Pennant unless it breaks to the downside again.
ETH is currently testing support levels at $ 120, which it has not been able to overcome satisfactorily. This allows the confirmation of a possible bullish breakdown of the flag to its immediate resistance located at the Fibonacci levels of 23.6% at $ 123,905, which it lost about twelve hours ago and it will be essential to think about recovery.
The worst scenario will take us to the bottom and think about levels close to $ 115 where its strong support rests. However, Ethereum depends heavily on what Bitcoin achieves in the general market, so the recovery of the leading cryptocurrency could generate an upward breakdown of ETH towards 38.2% Fib levels in a short while.
To try to better visualize the Ethereum scenario, we analyze the same graph with the technical indicators for the previously selected time frame.
In this case, Aroon shows the rapid journey of its bearish signal to the bottom of the chart as its counterpart begins to show resurrection signals. Aroon seems to be indicating that for now, a small recovery could happen in the next few hours if the bulls finally manage to take control of the market, after filling the respective accumulation process.
CMF for its part is pointing out the bad time of capital outflow in the cryptocurrency market generally.
RSI has successfully left the oversold zone and is in an ideal buying position. While its value recently declined to the lower limit of the sales area, we may begin to see a new pattern in ETH order books that signals the temporary recovery of its prices.
In the medium term, the cryptocurrency seems to continue projecting a drop to strong support levels at least until Q1 2020. According to the 1D chart of the ETH \ USD pair, if the altcoin fails to hold above the symmetrical triangle, it is possible that it touches Strong support levels by the end of next month at $ 113.85.
However, the most optimistic scenario for ETH could be a break above the symmetrical triangle and allow the price to be sent to Fib levels. 23.6% at $ 166.41, this would mean a profit in relation to the current price of up to + 42.98%.