Ethereum to dive to $3,800 as ETH bulls fail to break above key resistance confluence

• Ethereum price cannot break above the Cloud and return inside the bear flag.
• Bearish Engulfing candlestick pattern developing on the daily chart.
• Oscillators point to more selling pressure.

Ethereum price has faced considerable bearishness during Thursday’s trading session. The daily candlestick has been one that represents persistent, consistent, and constant selling pressure with nary a hint of any reprieve.

Ethereum price smacked by bears as bulls get led to the slaughter

Ethereum price action has spent the past four consecutive trading days pushing against two primary resistance zones: the bottom channel of a former bear flag and the top of the Cloud (Senkou Span A).

Near-term support for Ethereum is currently the confluence zone of the Tenkan-Sen, Kijun-Sen, and dominant interior trendline (black diagonal line) at the $4,100 value area. However, the nature of this daily candlestick should not be overlooked – it is the definition of a powerful bearish warning.w

A Bearish Engulfing candlestick pattern is a single candlestick that ‘engulfs’ the entire range of the candlestick preceding it. What makes Ethereum’s current Bearish Engulfing candlestick so powerful is that it engulfs the bodies of the last five candlesticks.

The following primary support zone that Ethereum will test is the bottom of the Cloud, Senkou Span B, at $3,800. Senkou Span B is the most powerful level of support/resistance within the Ichimoku Kinko Hyo system. Failure to keep a daily close above Senkou Span B would likely trigger a massive push south.

To invalidate this near-term bearish projection, buyers need to rally Ethereum above the Cloud and into a close where the Chikou Span is trading in open space. A close at or above $4,650 would fulfill both of those requirements. 

 

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