Ethereum has firmly surmounted its $400 for the first time in a few weeks, with buyers now attempting flip this level into support.
The crypto’s latest upswing has allowed it to outperform both Bitcoin and most other major altcoins significantly
Analysts are widely noting that the cryptocurrency is reaching a decision point, with its near-term trend likely being determined by how it reacts to the resistance that sits at $405.
That being said, a support-resistance flip of $380 could be enough to send it flying significantly higher, with one analyst noting that this could lead to an influx of buying pressure.
Ethereum Shows Signs of Strength Following Break Above $400
At the time of writing, Ethereum is trading up roughly 2% at its current price of $403. This is around the upper boundary of the trading range that the crypto has been caught within in recent weeks.
It is important to note that while the cryptocurrency has struggled to gain a foothold above $400 on multiple occasions in recent weeks, the strong reaction to its $380 support level seems to have reinvigorated ETH’s bulls.
One analyst is now noting that he is closely watching for $400 to be confirmed as support, as a flip of this level from resistance to support could be all that it needs to see significantly further upwards momentum.
“ETH / USD: Seems as though our support level at $380 was once again supported and buyers continue to step in heavily, even though we did bounce back above $400 for a brief minute, $400 still is acting as resistance for now… Expecting pullback to $390 then S/R flip at $400,” he noted.
Image Courtesy of Cactus. Chart via TradingView.
Analyst: ETH Must Surmount $405 to Avoid a Serious Drawback
He believes that a failure for it to surmount this level could cause it to see some significant near-term downside, potentially guiding it as low as $320.
“Good movement on ETH right up into $405. Somewhere around here is the major decision point for me. Narrative based but I don’t particularly like that this move has been pulled at the weekend, fits into my bias,” he explained.
Image Courtesy of Cold Blooded Shiller. Chart via TradingView.
Because of the critical nature of this level, how Ethereum trades in the coming few hours are vital for understanding its mid-term outlook.
Featured image from Unsplash. Charts from TradingView.