Ethereum has been trading in a range and is currently testing the bottom around $370, possibly due for a bounce to the top. Stochastic is pointing up to signal a return in bullish momentum, which might be enough for at least a test of the mid-range area of interest around the moving averages.
Speaking of moving averages, the 100 SMA is below the longer-term 200 SMA to signal that the path of least resistance is to the downside or that support is more likely to break than to hold. However, the gap between the moving averages is narrowing to signal weakening bearish momentum.
The 100 SMA could hold as near-term dynamic resistance around $390 while the 200 SMA could also provide an upside barrier at $400, which is also a psychological resistance level. A move past that could lead to a test of the range resistance near $420.
A break of support, on the other hand, could lead to a drop of the same height as the rectangle pattern. Keep in mind, though, that ethereum is also within a long-term resistance-turned-support zone at the moment.
Cryptocurrencies are struggling to hold their ground while market sentiment flips back and forth on uncertainty related to the trade spat between the U.S. and China.
Both nations are planning to impose higher tariffs on each others’ products as part of protectionist efforts or in retaliation to those. Since these are the top consumers of commodities worldwide, their trade tensions could have significant repercussions on demand for raw materials all over the world.
Meanwhile, the US dollar also has the NFP report to contend with. Strong employment figures could revive tightening expectations for the next few months, which might lend more support for the safe-haven US dollar. On the other hand, downbeat results could ease global tightening concerns and lead to a bit of risk appetite. Leading indicators are pointing to a potential upside surprise.