Ethereum traders can cash in by making this move

Ethereum traders can cash in by making this move

It’s futile to talk about the global cryptocurrency’s market current bull run without mentioning Ethereum. The world’s largest altcoin has seen a weekly surge of nearly 30% which actually sit slightly higher than Bitcoin’s percentage gains. However, ETH prices were still within the confines of a down-channel after a wider market correction stalled its northbound push. At the time of writing, ETH traded at $2,270, down by 3% over the last 24 hours.

Ethereum Daily Chart

Since May 19, ETH has consistently made lower highs and lows which eventually led to the formation of a down-channel. Despite ETH rebounding from $1,700 on several occasions, gains have been restricted below the upper trendline and sellers have responded at various resistance levels.

ETH’s 100% extension of its 22nd June low now rested around the $2,400 and clashed with the upper boundary of ETH’s pattern. Hence, an argument can be made that a successful close above this level would initiate an extended rally in the market.

$2,600 incoming?

Fiboancci Extension tool highlighted a couple of potential targets in case ETH breaks north of $2,600. The 127.2% Extension rested at $2,620 while the 161.8% Extension lay at $2,866. These areas were also largely in focus once bulls attempted various recoveries post the 19 May market decline. On the other hand, a minor dip can be countered between $2,100 and $2,160- an area bolstered by the 200-SMA (green).

Reasoning

The Relative Strength Index successfully climbed above 50-55 for the first time in over two months as buying pressure returned to the market. The Aroon up maintained close to 100% and indicated a strong uptrend. The Squeeze Momentum Indicator also eyed a move above the half-line, something that would denote a further increase in buying pressure.

Conclusion

ETH eyed a key breakout in the coming days to extend its current rally. A move above $2,400 would highlight its next target levels that lay at $2,600 and $2,800. Meanwhile, traders can wait for a breakout confirmation and long ETH once prices close above $2,400 to capitalize on this projected rise.

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