The asset has achieved this high after a strong 15% surge in the past 48 hours.
Unfortunately for bulls, a bearish signal just appeared that could deny further upside for ETH, at least for the time being.
Ethereum may have a fundamental case that allows it to continue to rally higher in the long run, though.
Just 48 hours ago as of the time of this article’s writing, Ethereum was trading for $245. The leading cryptocurrency now trades for $288 — a bit more than 15% higher than that aforementioned price.
The cryptocurrency could see a correction, though, according to a tried and true technical indicator.
Ethereum Could See a Correction From Here, Predicts Indicator
Ethereum could see a strong correction against Bitcoin according to the Tom Demark Sequential. The TD Sequential is a time-based indicator that prints “9” and “13” candles at inflection points in the trend of an asset.
According to the chart below, shared by a Telegram channel that tracks TD signals, ETH just printed a “sell 9” candle against BTC on a weekly scale.
Chart of the ratio between ETH and BTC (ETH/BTC) on a macro scale by a Telegram channel tracking Tom Demark (TD) Sequential signals. Chart from TradingView.com
Adding to the expectations of a correction, analysts have noted that $290 is a pivotal level for the cryptocurrency. It is where previous rallies, like the one in February, found a high and where Ethereum has historically found support.
Take the chart below. It shows ETH’s macro price action (over the past three years). As can be seen, the price zone around $290 has been of extreme importance for Ethereum bulls and bears.
Take late-2017, for instance, where it spent multiple weeks holding above $290 without breaking below that region.
This historical precedent suggests that Ethereum will struggle to pass this region this time around. How that plays out, though, remains to be seen.
Chart of Ethereum’s price action on a macro scale. Chart from TradingView.com
How About Its Bullish Fundamentals?
While there is this technical case for a correction, the asset’s proponents remain certain that the asset is undervalued from a fundamental perspective.
They cite the recent adoption in the decentralized finance space, which has injected billions of value and economic transfers into the Ethereum network. These commentators add that because DeFi promotes investors to lock up their ETH, prices should be driven higher.
Some, though, are not too sure that Ethereum has value. Bitcoin whale Joe007 commented earlier this year:
“DeFi is nothing but just another marketing ploy by a shadow gang of snake oil salesmen behind Ethereum. It’s obvious they’re trying to create another ICO-like mania. With the same 0 real utility in the real world.”
He added in a more recent comment that ETH is unlikely to reach its $1,400 all-time high ever again.
Featured Image from Shutterstock
Price tags: ethusd, ethbtc
Charts from TradingView.com
Ethereum Has Surged 15% in 48 Hours But a Bearish Signal Just Appeared