ETHXBT Price Technical Analysis: Larger Correction Underway?

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ETHXBT seems to be establishing some bullish momentum as price broke out of a descending channel pattern visible on its short-term time frames. This could open the door for a much larger pullback from its downtrend, possibly until the area of interest or broken support around 0.01500.

The 100 SMA is below the longer-term 200 SMA on the 4-hour time frame so the path of least resistance is to the downside. However, price is already breaking past the 200 SMA dynamic resistance so buyers might take control for the time being and allow an upward crossover to materialize.

RSI is on the move up to confirm that buyers are in control of the game but the oscillator is already dipping into the overbought zone. Similarly, stochastic is heading up so ETHXBT could follow suit and post a few more gains but the indicator is reflecting overbought conditions as well. It may take some time before sellers get back in the game but the line in the sand for the downtrend is located around 0.01500.

If that area holds as a ceiling, ETHXBT could resume its drop to the latest lows at 0.00750. Stronger selling pressure could even lead to a break below that level, especially since bitcoin is enjoying strong support against the rest of its counterparts like the dollar and the yuan.

Positive updates in the ethereum sphere have driven this particular cryptocurrency higher recently, signaling that it still holds a candle to its other rivals. According to co-founder Buterin, bitcoin is more likely than ethereum to have an intentional split in 2017. Just recently, the UAE went with ethereum over bitcoin for a real estate pilot program.

Bitcoin, on the other hand, remains supported by investor sentiment following reports showing massive capital outflow away from China and emerging markets. Investors from the mainland could continue to pursue higher returns from alternative assets in this regard, especially as traditional financial markets remain exposed to geopolitical risk this year.