Ether prices continue to hold strong despite technical headwinds.
At press time, the ether-US dollar (ETH/USD) exchange rate is roughly $305, up from a low of $287 in the wake of a recent software upgrade. And while the price may be down from a peak of $350 in the run-up to the release, the relative price stability may be impressive due to the supposedly shaky state of the code.
Of note is that ethereum’s new blockchain has still yet to be deemed stable by its developer team. Ethereum founder Vitalik Buterin informed markets this week that one or two months of further testing may be required before it can be declared as fully secure.
Still, as the blockchain continues to run without issue, concerns about the possibility of a harmful security bug in the new code appear to be fading.
As per CoinMarketCap, the cryptocurrency has lost 1.6 percent in the last 24 hours. Week-on-week, ETH is down 8.9 percent, while on a monthly basis, it is still up 7.78 percent.
But, will ether capitalize further on the sharp recovery from $287?
The price action analysis suggests that the odds of a bull run in the short-term are low.
The above chart shows:
- Wednesday’s long-legged (long shadow/long wick) candle shows dip demand. Thus, $287 (Wednesday’s low) is a strong support level.
- $250 (Post-hard fork high) is likely to act as a strong resistance.
- Bearish 5-day moving average (MA) and 10-day MA crossover.
- The daily RSI and Stochastic is bearish (below 50.00).
A re-test of $287 cannot be ruled out if prices breach the psychological support of $300.
On a larger scheme of things, only a break below $287 (Post-hard for low/Oct 18 low) would signal the rally from the Sept. 15 low of $202 has ended. Prices could then proceed to test $240 levels (Sept. 17 low).
A move above $320 in the next 24 hours would add credence to the sharp recovery from $287 and could yield rally to $345-350 levels.
Stacked blocks image via Shutterstock