Ethereum was previously trending lower inside a descending channel but has recently busted through the top to signal that a reversal is underway. Price has also moved past the 100 SMA dynamic inflection point to indicate that bullish momentum is picking up.
However, the 100 SMA is below the longer-term 200 SMA to suggest that the path of least resistance is to the downside. In other words, there’s still a chance that the downtrend could resume. The 200 SMA might even hold as dynamic resistance when tested.
Still, ethereum has formed a double bottom pattern and is due to test the neckline around $120. A break above this could confirm that a climb that’s around the same height as the reversal pattern is about to take place.
RSI is pointing up to reflect the presence of bullish momentum but is already dipping into the overbought zone. Turning lower could signal a return in selling pressure and a possible move back inside the channel. Stochastic is also indicating overbought conditions and turning south could lead ethereum to follow suit.
There have been some positive developments in the industry, particularly reports indicating that institutions are good to proceed with investments in the space despite the bear market. Recall that the recent selloff dampened hopes that big banks and funds could put more money in crypto – something that was widely expected to usher in a major price rebound.
Also, sources revealed that Nasdaq Inc. is moving ahead with plans to launch Futures contracts based on BTC. According to a report on Bloomberg:
Nasdaq has been working to satisfy the concerns of the U.S.’s main swaps regulator, the Commodity Futures Trading Commission (CFTC), before launching the contracts.
The New York exchange operator, which was first reported to be eyeing Bitcoin futures last year, wants to allow trading in the first quarter of 2019.
This led to an improvement in sentiment for the industry, spurring upside breaks for the likes of bitcoin and ethereum.