bulls and bears struggle to determine trend. Who will emerge victorious? By BeInCrypto

2023-05-19 02:32:32

© Reuters Ethereum: Bulls and Bears Struggle to Determine Trend. Who will emerge victorious?

BeInCrypto – The price of () has been falling since the beginning of April, when it deviated above an important long-term horizontal resistance.

While this may lead to more downsides, both bullish and bearish wave counts are still valid. Therefore, the direction of the long-term trend is still unclear.

Ethereum fails to sustain uptrend

ETH is the native token of the Ethereum blockchain, created by Vitalik Buterin. The asset’s week timeframe outlook is bearish, but it also provides some mixed signals.

In early April, Ethereum price reached an annual high of $2,151, sitting above the $1,950 resistance area. However, after a significant drop the following week, the price dropped below the area and validated it as resistance (red icon).

Therefore, the previous breakout is now considered invalid. This move is considered bearish as the bulls failed to sustain the rise. The closest support area is at $1,600.

However, the weekly Relative Strength Index (RSI) is still bullish. The RSI is an indicator used by traders to assess whether an asset is overbought or oversold and determine whether to accumulate or sell that asset.

Readings above 50 and an uptrend suggest that bulls still have the upper hand, while readings below 50 indicate otherwise. Therefore, a current reading above 50 is considered an uptrend signal.

Bulls and bears: who will win the dispute?

There are two potential wave counts for the Ethereum futures price. The first is bearish, stating that the price has completed an ABC corrective framework. If so, a significant move will ensue that will take the price to new lows.

Using Elliott Wave theory, technical analysts look at long-term price patterns and the psychology of repeating investors to determine the direction of a trend.

At this potential count, the A:C waves have an exact 1:1 ratio, which is most common in these structures. The ETH price will eventually drop below $1,000 if this count is correct.

The bullish count suggests that the bullish bounce is a bullish 1-2/1-2 wave structure. This means that the price is in subwave two (white) of wave three (black). This is an extremely high count at which the bounce slope accelerates as price begins sub-wave three.

For the count to be correct, ETH needs to bounce off the $1,600 support area and start a sharp move above $2,000. As the second 1-2 must have a steeper slope than the first, a break below the slope of the first (black) will invalidate the count.

To conclude, the future trend of ETH will be determined whether the price dips below $1,600 or rises above $1,950.

In the case of the former, a drop to at least $1,000 is expected. However, the price of ETH can reach $2,500 in the case of the latter.

This article was originally published by BeInCrypto