Ethereum price could be setting up for a move to replenish lost funds into the hands of investors. With market sentiment in extreme fear, a contrarian countertrend bounce is still a possible outcome.
Ethereum price should be watched closely
Ethereum price rose by 19% during the first week of December following November’s 36% downtrend. Now, as the ETH price hovers in above the 8-day exponential moving and 21-day simple moving average, a possibility to rally towards the November high stands a fair chance of occurring.
Ethereum price currently auctions at $1,276. The bulls successfully breached through a broken support zone with a slight uptick in transactions on the volume indicator. A Fibonacci retracement tool covering the entirety of November’s downtrend shows the same as a 38.2% retracement level.
If the market is genuinely bullish, a breach of $1,300 should be the catalyst for an uptrend move targeting 50% and 61.8% Fib levels. The uptrend would have the potential for up to a 13% increase in market value targeting the “Golden Pocket” 61.8% Fib zone at $1,416.
Invalidation of the bullish outlook could arise if the bears break the bullish engulfing candle that pierced the 38.2% Fib level. A plummet below $1,211 could include an additional decline targeting the November low at $1,075. The Ethereum price would fall by 14% if the bearish scenario played out
