Ethereum May Have Bottomed Out – is it Time for Recovery?

The value of Ethereum continued to fall, dropping below the support level of $3,320.

ETH tested support at $3,240 and is now poised for a potential rally above resistance at $3,380.

The price of Ethereum has encountered difficulty for a new advance above the $3,500 area. Following Bitcoin’s bearish trend, ETH dropped below $3,350 and bears pushed it below the $3,320 support level.

A low of $3,230 was established and the price is now correcting its losses. There is a minor upside move above the $3,300 and $3,320 levels. The value of the altcoin has climbed above the 23.6% Fib retracement level of the recent decline, moving from a high of $3,517 to a low at $3,230.

At the time of writing, Ethereum is trading below $3,400 and the 100-hour simple moving average. On the upside, resistance could be encountered near the $3,375 level or the 50% Fib retracement level.

The first significant resistance is near the $3,450 level. In addition, a key bearish trend line is forming on the hourly chart of ETH/USD with resistance around $3,440. At the time of writing, the altcoin price is hovering around $3,370.

Potential upside and key resistances

If ETH manages to break above the $3,540 resistance, it could head higher. The next key resistance is at the $3,620 level, which if overcome, could lead to a price rise towards the $3,650 level. Further gains could push the cryptocurrency towards the $3,720 resistance zone in the coming days. 

Potential for a new decline

If Ethereum fails to overcome the $3,450 resistance level, it could face another decline. Initial downside support is near $3,325 and the first major support is around the $3,240 area.

A clear move below the $3,240 support could see the price fall to $3,200. Any further losses could bring the price to the $3,120 level in the short term.