Ethereum is testing a major area of interest as traders await the Constantinople upgrade. Price is testing the former resistance turned support level around $120 and could be due for either a bounce to the Fib extension levels or a deeper slide back to the swing low.
The 100 SMA is above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. In other words, the climb is more likely to gain traction than for the selloff to carry on. Note that the recent slide was likely due to liquidation ahead of this upgrade after all.
Also, the 200 SMA may continue to hold as dynamic support at the area of interest. If it’s able to keep losses at bay, Ethereum could climb to the 38.2% resistance at $150 or the swing high near the 61.8% extension of $160. Stronger bullish pressure could take it up to the 78.6% extension at $184 or the full extension at the $200 major psychological level.
RSI is also heading north so Ethereum might follow suit as buyers stay in control. The oscillator has some ground to cover before indicating overbought conditions, so bulls could stay on top for a bit longer.
Stochastic, however, is already in the overbought region to signal exhaustion among buyers. Turning lower could reflect a return in selling pressure and a continuation of the slide.
Note that the upgrade has been postponed from an earlier date last year, so expectations are higher that things could go smoothly. Five EIPs are set for implementation that promises improvements in efficiency and smart contracts verifying themselves.
EIP 1014, known as CREATE2, was developed by Vitalik Buterin and is seen as a precursor for the scaling solution based on off-chain transactions. The most-watched among these is the EIP 1234, which interestingly comprises two components, Block Reward Reduction, and Difficulty Bomb Delay.
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