With less than six hours left on the clock for the daily candle closing, ETH prices show a gain of almost 5% and surpass the $2600 mark. The reversal from the confluence area of the support trendline and $2500 undermines the selling observed in the previous candle.
ETH price reversal comes within the symmetrical triangle pattern and remains under the resistance trendline influence in the daily chart. Therefore, buyers at the current price must stay vigilant and mitigate their risk at the 50-day EMA.
Speaking of the resistance trendline, active selling at the trendline has crushed multiple bullish attempts since December of last year. Moreover, the death cross has flipped the 50-day EMA as it provides dynamic resistance.
Hence, the triangle pattern shows a relatively more robust resistance trendline, increasing the chances of a bearish fallout. However, the recovering market and the upcoming technical indicator indicate otherwise.
Relative Strength Index: The RSI slope’s value comes closer to the 14-day average, with a bullish divergence present in the last two dips. However, the slope must surpass the descending trendline to generate a strong bullish signal.
On-chain Data Takes A Bullish Accent
The Global In/Out Of Money indicator shows the ETH prices surpassing the “At the Money” cluster and takes the challenge to overcome the relatively weaker resistance between $2640 and $2700.
The indicator also bears some slightly good news that 65% of HODLers made a profit at market price.
Whales Coming A Bit Bearish
$207 Million worth of Ether (ETH) was just transferred between 2 nameless cryptocurrency wallets in a single transaction. It increases the fear of a triangle fallout as whales have the potential of bringing a sudden fall if they exit this Ether position. According to Glassnode, 91,282 Ethereum wallets have more than $100,000 worth of Ether.
Cushion Prepared By Safe Traders
Smart traders HODLing long positions in the spot or futures market generally buy a put options contract when the volatility increases, bringing a temporary drop in the asset’s price.
One such savvy trader or a group of traders has bought approx 37,000 Put contracts expiring on March 18th on Deribit, the world’s largest crypto options exchange by trading volumes and open positions. However, most of these orders, around 20,000 of them, were blocked by Paradigm, the over-the-counter tech platform.
Put contracts buyers have the right but are not obligated to sell the underlying asset at a previously decided price or a date. Hence, a fall below $2200 by March 18th will help these Put option buyers make a profit.
Should You Buy Ethereum?
For long-term exposure, Ethereum remains a potential multi-bagger. It holds the crown of DeFi with over $107 Billion of total value locked and dominance of almost 18% of the crypto market.
Traders with a short-term lookout can also find a buying spot at current prices, as the reversal hints at approaching the resistance trendline. However, safe traders or traders looking to ride the next trend might want to wait for the triangle breakout.
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