Bottom line: Ethereum medium-long term structure remains bullish until prices stay above 90.00 mark. Corrective drops are possible and support should be seen around 150.00 zone.
Fundamental Outlook:
US Jobless claims print 4.4 million yesterday, bringing the total number of claims to over 26 million over the past 4-5 weeks. The economic instability caused due to COVID-19 pandemic is here to stay longer and the US Equity markets are beginning to show signs of another selloff ahead. An additional relief package of USD 484 billion was not enough to aid the rally.
Leaders of the European Union has agreed upon a rescue plan to help stressed economies. Over 540 Billion Euros financial aid was confirmed, which could be released from June 01, 2020. The European Commission has been tasked to finalize a plan, which is agreeable to all EU leaders, going forward.
Technical Analysis:
Ethereum remains in control of bulls for now as prices hit 195.00 handle. The long term structure remain bullish against 90.00, but traders might be warned to remain cautious around these levels. A corrective drop towards 145.00/150.00 levels would be considered ideal before the rally resumes.
The recent rally between sub 90.00 and 195.00 has reached fibonacci 0.618 retracement of the previous drop (252.00 through sub 90.00). Ethereum might face interim resistance around 195-200 levels and at least produce a corrective drop before resuming higher again.
Support comes in around the 145.00 mark and extends up to 142.00, which is the past resistance turned support zone. A bullish reversal there would be encouraging for the next Bull Run towards 252 and 280 respectively.
Most traders might be preparing to take some profits on long positions taken earlier around current price (188.00/190.00). Further it might be safe to initiate fresh long positions between 142.00 and 145.00, with stop below 90.00 and target towards 280.00 respectively.
Prepared by
Harsh Japee, Technical Analyst.
Ethereum Chart
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