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  • Ethereum price recovers quickly from a slump to $1,726.
  • A double-bottom technical pattern bolsters ETH as bulls eye $2400.
  • The parabolic SAR flipped from negative to positive reinforcing the bullish thesis.

Ethereum is exchanging hands 25% higher than the July 20 low at around $1,726. Recovery was quick and sharp, probably due to bulls’ congestion near the support area. It could also be that investors took advantage of the July 20 Ethereum price downswing that was experienced across the crypto and stock markets and entered the market while prices were lower and speculate gains towards $2400.

At press time, Ethereum price was trading at $2,162 while battling an immediate resistance at around $2,316. Note that a daily candlestick closure above this level   will see ETH breakout upwards as bulls eye $2400, 15% above the current price.

Ethereum Price Nurtures a Double-Bottom Recovery Pattern

Ethereum price appears to have spelled out a double-bottom pattern on the daily chart after the sell-off was halted at $1,726. A double-bottom is an exceptionally bullish chart pattern that often results in a trend reversal.

Note that this pattern forms when an asset tests a support level twice without breaking below it. The two bottoms are usually separated by a moderate peak as shown on the Ethereum’s daily chart.

A breakout from this technical pattern will be confirmed when the Ethereum price jumps over the resistance immediate resistance at$2,316. If this happens, ETH could explore highs recorded at the beginning of June at around $2,897.

Ethereum Price (ETH/USD) Daily Chart

Ethereum Daily July 25

Apart from the technical chart pattern, the parabolic SAR flipped from negative to positive on July 23 adding credence to the bullish outlook. This bullish thesis is further accentuated by the Moving Average Convergence Divergence (MACD) on the same daily chart. Note that traders responded to the bullish crypto signal when the MACD line 12-day Exponential Moving Average (EMA) crossed over the 23-day EMA. The uptrend will gain more momentum once the MACD crosses the zero line into the positive region.

Note that a daily closure above the immediate Ethereum price barrier at $2,36 is crucial to sustaining the anticipated upward breakout.

Can the ETH Breakout Be Sustained?

Note that the flattening of the Relative Strength Index’s (RSI) indicates that the bullish momentum is slowing down. A cross over the midline towards the oversold region will trigger more well orders. If this happens, ETH’s bullish thesis will be invalidated.

Closing the day under the 50-day SMA at $2,86 will also curtail the recovery efforts and trigger another sell-off, resulting in another correction towards the $2,000 psychological level and $1,726 respectively.

If you are seeking to buy Ethereum, this list of crypto brokers might be helpful.

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