At one point down 4% on Friday, the $ETH price has broken down through its August uptrend. Is this just a fakeout or the start of a longer accumulation period, or could this be the beginning of something more serious? $ETH breaking trend Source: TradingView The daily chart for the $ETH price shows that a breakdown of the ascending trendline, active throughout August, may be taking place. Of course, the day is not done yet, and there is the possibility that the price can still return above the trendline should the crypto market receive some kind of boost. The US stock market opening in a few hours could even supply that boost. That said, if the price does continue to break down, there is major support below at $4,000, which bulls would expect to hold. Conversely, if the price breaks back up, the new all-time high is not very far overhead at $4,950. $ETH potential double top? Source: TradingView Zooming out into the weekly time frame a couple of nagging concerns do show themselves, although as mentioned already, if the crypto market sentiment does change, $ETH could be back to all-time highs in an instant. Back to the bear case. This weekly red candle is enveloping the previous one. Also, if this were a top for $ETH , it would be a double top with the 2021 high forming the other top. A double top could certainly lead to a major breakdown. At the bottom of the chart, the Stochastic RSI indicators are bouncing along the top of their range. How much longer can they continue to do this? There have only been two other periods for the entire history of $ETH when the indicators have generally stayed above the 80.00 level for longer. ETH/BTC rejection from descending trendline Source: TradingView Finally, one needs to compare $ETH to $BTC (ETH/BTC). Here it can be seen that $ETH is being rejected from the long-time descending trendline. Also, the good horizontal support at 0.04 looks as though it might fail. Once again, the Stochastic RSI indicators are bunching at the top of their range. It really does look as though a fall back down to earth is probably going to take place from here. Where will this take the $ETH price ? $3,500 or $3,000 are major support levels. That’s not to say that the bull market will be finished for $ETH, but it does put the possibility of a 30% to 40% bull market correction on the table. Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
