Analysis: Is Ethereum Finally on a Recovery Trail?
Ethereum seems to be starting an uptrend in the short term. This comes after a longer downward movement. So is this an illusion, or is Ethereum really recovering? Let’s take a look at the charts.
The big picture
To get a good idea of the strongest price levels of ETH, we need to take a large chart. In this analysis, we start with the daily chart, where each candle represents 24 hours. Here we see a gray, a red and a blue price zone that are important for the price.
We can leave the grey zone for what it is for now, but the red and blue zones are important. The coin is currently trading in the middle of these, after ETH was rejected at the bottom of the red zone. Since then, we have to wait until the coin shows a sign of recovery.
On the daily chart, this doesn’t seem to be happening yet, as the coin has only gone down since the red zone. So we need to look at a smaller chart to spot short-term recovery signals.
Has ETH started an uptrend?
If we want to see the price in more detail, it is better to take the 4-hour chart. Here each candle represents 4 hours, which gives us a more detailed picture of SHIB. Here the rejection is also better visible at the red price level. This is indicated by the orange circles.
After SHIB was rejected twice, the coin started a decline that has not really slowed down yet. However, there seems to be a sign of life now, as Ethereum has made a higher low and a higher high on the 4-hour chart. This is the formula for the start of an uptrend.
If the coin continues like this, Ethereum can probably make another attempt to break through the 3,600 dollar price. This could be a nice push to recapture the red zone.
This small uptrend can certainly contribute to the recovery of ETH, but for that I would like to see one more new higher low. In that case I consider it an uptrend, and I would expect nothing less than a further move higher.
It is important to note that the coin can drop back to the blue zone if it moves below its previous highs and lows. Therefore, keep a close eye on this trend.
