Will Ethereum hold on to this level of support?

Ethereum traded within a descending channel and broke out as it found support at $2,370. The price target for this break out was met at $2,447 after which it turned around and the sellers booked profit. At the time of press, ETH was being traded at $2,383.

Ethereum hourly chart

Source: ETHUSD on TradingView

Ethereum’s previous fall was defined within a descending channel, which broke out and registered almost 4% gains. However, the traders were unable to hold on to $2,448 and a sell-off was triggered.

As the price breakdown was in progress, ETH can find support at $2,370. Price could get a grip at this point and may take a turn.

Reasoning

The descending channel resulted in the price of Ether moving under the 50 Moving average. As MA was gradually forming a downward curve, it may act as a point of resistance for the price. With three consecutive red candles, the downward pressure was clear in the market, and the Directional Movement Index was highlighting an increasing downwards pressure.

Interestingly, -DI remained above +DI ever since the fall experienced on Wednesday. At the time of press, the -DI had moved further away from equilibrium, suggesting the selling pressure had spiked. ADX at 22 was supporting this downward pressure trend but with a lack of momentum, ETH may continue to trade close to the support at $2,370.

Interestingly, if the buying pressure rises, the value of ETH could hit $2,422- a Point of Control as highlighted by the Visible Range.

Conclusion

The Ethereum market remained under bearish pressure for the past couple of days. As the selling pressure was rising, the price could hold on to the support at $2,370 and potentially consolidate at this level.