Ethereum (ETH) is trading in a bullish range above $3,720. ETH is showing positive signs and it may break the $4,000 resistance soon.
Ethereum has been rising continuously over the past few days at the $3,550 resistance level. The approval of an exchange-traded fund (ETF) for ETH by the U.S. Securities and Exchange Commission has triggered a strong upward trend. The price rose to the $4,000 resistance range. With a high price of $3,975, Ethereum has basically outperformed Bitcoin.
The price is currently consolidating gains and is trading well above the 50-day simple moving average (blue line). It looks like the bears are blocking the price from breaking above the $4,000 resistance level. Meanwhile, there is also a short-term ascending channel forming on the daily chart with resistance at $4,000.
The recent few daily candles suggest that Ethereum bulls are exhausted. Therefore, there could be a short-term downside correction at the $3,800 level. The first major support is near the $3,720 level.
This is the 23.6% Fibonacci retracement level of the recent rise from the $2,869 low to $3,975 high. If the price breaks below the $3,720 support area, there could be a risk of a bigger correction. In such a case, the price could test the $3,600 level.
The next major support is at $3,420 near the 50% Fibonacci retracement level of the upward move from the $2,869 low to $3,975 high. If the price breaks down and closes daily below $3,420, ETH could drop to the $3,240 support and the 50-day simple moving average (blue line).
Ethereum might consolidate or correct before the next up move. On the upside, an immediate resistance is near the $3,950 level. The first major resistance is near the $4,000 level and the channel trendline.
If the price clearly breaks above the $4,000 resistance, it could spark another rally. In such a case, the price might pick up and test the $4,080 resistance. The next major resistance is near the $4,250 level. If the bulls break the $4,250 resistance, the price might move up to $4,400 in the near term. If the bulls break above the $4,400 resistance, the price might quickly move up to the $4,650 resistance level.
Overall, Ethereum price is consolidating gains above $3,800 and $3,720. If ETH breaks the $4,000 resistance, it could rise by $10% in the near term.