Ethereum (ETH) reached the low of 2,698, the level last seen on March 16. Today, the crypto is currently trading at 2,819 recovering part of the losses and consolidating above the 21 SMA located at 2,825.
For the past few days, momentum was making daily highs in ETH but the price is now retracing. It suggests that sentiment remains negative and traders are selling on rallies.
Since April 18, Ether has been trading within a falling wedge. At time of writing, it is just trying to break the top of the bearish channel of this pattern.
If in the next few hours Ether manages to trade above 2/8 Murray and breaks the falling wedge pattern and finally consolidates above 2,850, this will be a positive sign. ETH is likely to recover and reach 200 EMA located at the psychological level of 3,000 and could even reach 4/8 Murray at 3,125.
The bulls are bullish as Ethereum now has 12.5 million ETH tokens staked. An increase in the staked supply of Ether reduces its circulating supply. A reduction in circulating supply is bullish for the price of ETH/USD.
The key to a rally in Ether is to wait for a consolidation above the psychological level of $3,000. If this scenario comes true, ETH could reach a key level of 3,500 (7/8 Murray) which represents the high April 04.
Conversely, if Ether fails to consolidate below 2,900, it is likely to continue its downtrend and reach the support 1/8 Murray at 2,656 and even 2,500 (0/8 Murray) a key level.
Our trading plan is to wait for a sharp break above 2,825 (21 SMA) to buy, with targets at 2,968, 2,989 (200 EMA) and 3,125 (4/8 Murray).