Since the price of Ethereum’s native digital currency, Ether (ETH), has shown enormous strength recently, the path seems to be continuing towards new highs. Ether’s price went from $220 to $445 in the previous five weeks and this is one of the biggest increases for the altcoin in the last 18 months.
However, since the rally didn’t provide many opportunities for the stragglers to get on the train, is $500 the next target for Ether? Let’s look at the technical configuration.
Ether changes the crucial level for the support that feeds the upward momentum
When Ether broke through the magic barrier of $340-360 as a crucial resistance, it was imperative for the bullishers to turn this area into a new support zone.
The chart shows the importance of this level, as the $340-$360 zone became support during all the previous bull market. However, the August 2018 breakout resulted in a two-year accumulation range.
Similarly, an earlier test in the $340-$360 range in July 2019 failed to break this crucial resistance zone. Recently, a renewed breakout led to a breakout as the chart confirms the change in support/resistance.
Furthermore, Ether is recovering above the 100 and 200 day moving averages, which are crucial for the upward momentum. As long as Ether maintains support above these moving averages, further upward movement is likely.
Shorter-term trend modification confirmed
The shorter time frames indicated an apparent trend reversal, as the graph shows.
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First, the support area of the highest crucial time frame between $340 and $360 provided support once again.
This support confirmed support through the double bottom structure in smaller time frames, indicating a possible bottom confirmation.
As a trader, the next confirmation you would like to get is a new higher maximum, which was confirmed once Ether’s price broke the $408 maximum (the red line). This advance led to a further price increase, which is almost a new yearly high.