After a powerful dump of the cryptocurrency market, Ethereum showed the greatest stability and craving for new records. At the moment, the coin dropped to $3,478, where it bounced into the $3.8k- $4.2k area. The coin showed a very confident buying back of the volumes that arose in the market. As a result, the first fluctuation range of $3.8k- $4k was quickly passed.
On Monday, December 6, the bears tried to push the price below $4k but met fierce resistance from the bulls. The support zone held out, and the altcoin resumed its upward movement and is trading at $4.4k as of December 7.
The key reason for such a rapid resumption of growth in ether is the bullish breakdown of the $4.2k mark, where the difficult resistance level passes. Most likely, after the impulse growth to $4.4k, the price will pause and correct. In this area, the main target for the bulls will be to hold the $4.2k milestone in order to stay within the upward trend.
I assume that the current impulse price movement will end near the $4,580 mark, where the key resistance level passes before moving to the absolute maximum. With the subsequent decline, the $4.2k level will play the role of support, and if the bulls manage to hold it, then the altcoin is able to immediately make a bullish breakdown of $4,580.
This is indicated by fundamental factors, which are supported by bullish signals on the MACD and the stochastic oscillator. On the Chicago Mercantile Exchange, 1/10 ETH micro futures contracts began trading, which served as an increase in the on-chain activity of the coin.
The current impulse rally was accompanied by a surge in the number of unique addresses, as well as an increase in transaction volumes, which indicates the fundamentals of the current altcoin growth. In addition, there is an upward trend in interest in Ethereum futures on CME, which also indicates the activation of buyers and readiness to go to new highs.
Among the immediate targets of ETH, it is worth highlighting the bullish breakdown of the downward trend line from December 1. I assume that the coin will successfully assault this mark, but will subsequently adjust and fall behind it. Taking this into account, we can expect a longer period of fluctuations within the descending channel with the final point at $4,475.
However, in general, the situation around ether is maximally bullish, MACD enters the green zone and rises above the zero mark, while the stochastic continues to move into the overbought zone and forms another bullish crossover. This indicates a breakdown of the downward resistance line, but also signals the need to cool the fervor after such a powerful rally.
I expect a local correction after a powerful impulse movement, which will subsequently allow us to accumulate free volumes in the market and continue the bullish rally. With a repeated breakdown of $4,580, we should expect further movement and a likely rebound from the absolute maximum level. This time, the top of the descending resistance line will play the support zone, and the price, starting from it, will go to conquer new highs.
It should be borne in mind that the upcoming meeting on digital assets in Congress and the next speech by the head of the Fed may make significant adjustments to the local price movement. At the same time, the overall picture remains bullish and the market is ready to carry Ethereum to new historical highs.
The material has been provided by InstaForex Company - www.instaforex.com