ETHXBT finally picked a direction as it broke out from the symmetrical triangle consolidation pattern. Price broke to the upside, indicating that a longer-term climb could be in the cards.
The triangle formation is approximately 0.01000 tall so the resulting breakout could be of the same size, taking ETHXBT up to 0.03000. However, if this proves to be a fakeout, ethereum could fall back in consolidation.
The moving averages are still oscillating for now as the 100 SMA and 200 SMA have yet to incorporate the latest breakout in their movement. A widening gap between the moving averages would confirm strengthening bullish pressure, keeping ETHXBT on track for more gains. On the other hand, a downward crossover could be indicative of a return in bearish momentum.
Both RSI and stochastic are indicating overbought conditions so there might be a bit of profit-taking before ETHXBT continues its climb. Price could retreat to the broken triangle resistance around 0.02000 before making further headway north.
Bitcoin has been retreating against its peers as dollar strength and risk aversion are in play. This means that investors are moving their funds to the safe-haven currency on expectations of weaker global growth juxtaposed with higher odds of an interest rate hike from the Fed later this year.
Economic data from the US has been mostly upbeat, particularly on the jobs front. This suggests that the NFP reading could come in higher than expected and put upward pressure on wages, thereby lifting inflation expectations as well.
Meanwhile, data from China has been mixed as the official manufacturing PMI showed a stronger than expected result while the non-government version printed a slowdown in industry growth. Data from Australia has been disappointing, keeping risk-off moves in play.
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