4 min readEthereum (ETH/USD) is experiencing a powerful rally, posting gains of more than 32% in just two days at the time of writing. This move has caught the attention of traders across the market, and now, price is rapidly approaching a major high time frame resistance area that we’ve marked out in previous updates — the 2,400 level.
Given the historical importance of this zone, it would not be surprising to see price temporarily stall here, or even produce a rejection before further continuation. However, if this rally continues without hesitation, the next major resistance level to keep an eye on is located around the 2,700 mark, a key level from Ethereum’s previous high time frame structure.
One technical aspect worth paying close attention to in this current breakout is the ADX (Average Directional Index), which is visible at the top of the chart. The ADX appears to have put in a rounded bottom and is just starting to lift, indicating that trend strength may only be beginning to build. This is particularly notable because the ADX had been in a steady downtrend for the past month, while Ethereum carved out a base during April.
For traders looking at momentum and trend-based continuation, it may be useful to study how the ADX behaved during previous Ethereum rallies when price approached similar high time frame resistance zones. If the ADX continues rising from this level, it could signal that the current trend still has strength left in it.
Ethereum remains technically strong in the short term. But as always, with price approaching key resistance zones, it’s worth staying alert for both continuation and signs of a potential pullback.
Trading involves risk.
Author
Risk DisclaimerThe financial products offered by the Company are complex and come with a high risk of losing money rapidly due to leverage. These products may not be suitable for all investors. Before engaging, you should consider whether you understand how these leveraged products work and whether you can afford the high risk of losing your money.
The Company does not accept clients from the Restricted Jurisdictions as indicated in our website/ T&C. Some services or products may not be available in your jurisdiction.
The applicable legal entity and its respective products and services depend on the client’s country of residence and the entity with which the client has established a contractual relationship during registration.
