Ethereum (ETH) Readies for Another Attempt at Moving Above $4,000

While Ethereum (ETH) has increased considerably in the month of October, it has yet to move above the September highs at $4,027.

It is currently attempting to find support above $3,650, after which an upward movement is expected, which would take ETH above its Sept highs.

Current movement

The daily chart shows that ETH has broken out above the $3,650 area, which had previously been acting as resistance since Sept 12. It did so on Oct 14 (green icon). 

The breakout led to a high of $3,971 three days later. However, the ensuing rejection served to validate the $3,970 area as resistance. ETH is now trading between these two levels. 

Despite the rejection, technical indicators provide a bullish outlook. The MACD, which is created by a short- and long-term moving average (MA) is increasing and is in positive territory. This means that the short-term trend is faster than the long-term one. 

The RSI, which is a momentum indicator, is showing a reading higher than 50. This is a sign of a bullish trend. It first moved above 50 on Oct 1, at the same time that the upward movement began. 

Finally, the Supertrend, which uses volatility in order to determine trend, is also bullish (green icon). The ETH price moved above the Supertrend line on Oct 14, the same day it broke out above the $3,650 resistance area. Therefore, it made the line bullish. 

So, the daily time-frame provides a bullish outlook for ETH and suggests that a breakout will eventually occur.

Wave count

Cryptocurrency trader @Altstreetbet outlined a wave count in which ETH reaches $4,000 in the short-term.

The wave count shows that ETH is currently in wave four of a bullish impulse. A bullish impulse is created by five waves, so this means that another upward movement is expected. 

In the current one, wave three has extended, so it is considerably larger than wave one and most likely wave five. 

Wave four could end at the $3,650 support area, since it also coincides with the resistance line of a parallel ascending channel from which ETH previously broke out. The line is now expected to act as support, thus providing a confluence of support levels at $3,650.

The more bearish scenario would take ETH to $3,350, completing a fourth wave pullback in the process. The $3,350 target is created by the 0.5 Fib retracement support level and the middle of the parallel channel.

The longer-term wave count (orange) shows that ETH has already completed a bullish impulse in the period from June 19 to Sept 4, culminating with the aforementioned $4,047 high. 

Therefore, it is now in wave one of the second impulse, which is expected to eventually take it to a new all-time high.

ETH/BTC

The ETH/BTC gives a much more bearish outlook than the USD pair. 

The token has fallen back inside a long-term ascending parallel channel and validated it as resistance (red icon). Until it breaks out again, the trend cannot be considered bullish.

In addition to this, both the RSI and MACD are decreasing. The former is below 50 while the latter is negative, both signs of a bearish trend.

The closest support area is at ₿0.0575. It is both a horizontal support area and coincides with the middle of the parallel channel.

For BeInCrypto’s latest Bitcoin (BTC) analysis, click here.

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