Ether hodlers are in euphoria this week. Indeed, the second crypto by market capitalization has seen only green days since Tuesday. In a short-term uptrend, Ether was able to gain over 16% in value. But after breaking through the $1400 resistance, the bulls are hitting a hurdle again. Will they be able to push ether past $1780? Check out this analysis.
Beginning of a new uptrend for Ethereum?
The rise of the crypto sector this week has revived the optimism of many investors. By the way, green candles are not just for ether, but for most cryptos. Besides that, all financial markets seem to be recovering from the crisis. Which also gave a boost to the crypto industry. Indeed, there are several catalysts that have driven the price of Ether into an uptrend.
First, there is the drop in the dollar, which has lost more than 2% in value this week. Moreover, the positive news coming out of the UK also seems to work in favor of cryptos. Indeed, a new law on digital assets is currently awaiting approval by the upper house of parliament. Moreover, the new British Prime Minister is “pro-crypto”.
It is therefore no wonder that the crypto market is doing very well this week. Alongside this, the rally in US stocks is also pushing Ether into the current uptrend. Indeed, the S&P 500 has gained 2.5% since the start of the week. Tech giant Meta also gained 5.5% in yesterday’s session, and Netflix +4%.
In sum, it looks like bulls are finally entering the crypto market. However, in the case of ether, these bullish investors face several obstacles. Indeed, the convergence between the RSI and the price of ether could put a brake on the uptrend of the week.
RSI convergence
On a daily chart, we can see a convergence of the RSI (two red lines on the image above). This is a pattern that normally precedes the continuation of Ethereum’s downtrend. Convergence is represented by lower and lower highs on the price, and higher and higher highs on the RSI.
Thus, we should expect a further drop in ether, based on the logical continuation of this pattern. Moreover, the price of this crypto is currently sitting on a quite crucial resistance zone. After breaking through the upper part of the $1200 and $1400 range, ETH is already at the nearest resistance. This is the area between $1568 and $1634.
Ethereum buyers will then need to be cautious around this level as the price may continue its downtrend. However, bulls are quite capable of breaking through these resistances. Indeed, they are supported by the positive news that is working in favor of the crypto industry. Therefore, a real battle between bears and bulls should take place on this level.
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