How is Ethereum looking now? Can I buy it?

[iwantmoney]

[Rakesh Upadhyay]

Ethereum (ETH) has been in a long bear market. It has plunged sharply from its lifetime highs of $1,419.96 to the current levels. However, for the past few months, the downtrend has stalled. So, is this this a pause before the downtrend resumes or is a trend reversal in the offing? Let's find out.

ETH hit a low of $80.6 in early-Dec. of last year. Since then, the cryptocurrency has been attempting to put in a bottom. After such a long bear phase, we expect the digital currency to form a large base, before breaking out from it. The longer the base, stronger will be the eventual break out from it. The 20-week EMA is flattening out and the RSI has been creeping higher, which shows that the bears are losing momentum. Let's see if we can find a buy set up on the daily chart.

On the daily chart, we find a bullish ascending triangle pattern developing, that will complete on a breakout and close (UTC time frame) above $160.6. Following the break out, the pattern target on the digital currency is $240.6, but we expect the rally to reach $255. It won't be a one-way rally, as it will face resistance close to $220 and above it at $240. Nevertheless, we expect these levels to be crossed.

For an entry, you can buy about 40% of your desired allocation at $148 and the rest above $160. The initial stop loss for both these entries can be kept just below the trendline of the ascending triangle at $115.

Currently, both the moving averages are gradually moving up and the RSI is also in the positive territory. This suggests that the bulls have a slight advantage.

Our bullish view will be invalidated if the digital currency plunges from the current levels and breaks below the support at $118. Such a move can result in a fall to $100.15 and below it to $80.6.