Sellers could not fix below $192-194.
The mark $216 is an indicator of the strength of buyers.
The main scenario – the test of $164 remains valid.
Yesterday in Ethereum market sellers tried to push the price below the previous local low and the range $192-194. The daily candle closed at Ethereum price $205.4 at lower volumes than the candle on 4 May. Due to low volumes, sellers’ attack failed and today buyers will test for the strength $216. Despite the local highs, buyers are quite active in buying out ETH. Proof of it is the closing of the daily candle on 4 May with a large pin down.
The future success of buyers depends on the trading activity today. The fact is that after the test of $192-194 and the confirmation of sellers’ weakness by the candle on 5 May, buyers must actively continue to build a growth trend. If we see a passive price growth, driven by low volumes – it will be the signal to start a reversal. Therefore, now the local mark $216 will serve as an indicator of buyers’ strength.
If we analyze the activity of sales and purchases during 4-5 May, we see that the difference between them on 5 May was bigger than on 4 May. By candles appearance in Ethereum market everything looks vice versa. It indicates insufficient strength of sellers in this range to pass the limit orders of buyers. However, sellers are more active and today’s rebound of Ethereum price probably up to $216 can only be a correction.
In the 4-hour timeframe, we see an ambiguous increase of Ethereum price:
With small candles, the price on Ethereum market creeps along the trend line, once again falling within the wedge. We also formed a local channel, which was formed from 30 April. Therefore, if this type of growth continues, we will see a sharp price fall with the first target $192-194. The next target is $164, which in principle has not changed since the previous analysis.
The dominance of ETH in the crypto market will continue to decline and according to the chart reaches a critical point:
As you can see, during Bitcoin price growth, Ethereum price rises weaker, but during its fall, ETH falls more aggressively. That’s why, our opinion remains unchanged and the correction with the first global target $164 remains our main scenario.
Let’s see if Ethereum market participants will be able to get out of the consolidation wedge again and show vector movement by Friday.
Image Courtesy: TradingView