Technical outlook:
Ethereum rallied through $3,200 mark as discussed and projected on Tuesday. The crypto is seen to be pulling back lower and is trading close to $3,100 at the time of writing. It has tested the Fibonacci 0.382 retracement of the earlier drop between $4,800 and $2,100 levels respectively. Also note that a shooting star candlestick pattern has been produced on the daily chart indicting a potential turn lower.
Ethereum could drop toward $2,500-70 mark from here, which is also the Fibonacci 0.618 retracement of the recent rally between $2,100 and $3,200 levels. The crypto can be expected to resume its rally through $3,800-4,000 mark to terminate the corrective rally, which began from $2,100 levels. At this moment, we expected the structure to be bearish and turn lower from the $3,800 zone.
Ethereum might be carving a Head and Shoulder reveral pattern sine $3,800 highs (Head). Potential Neckline has been broken at $2,680 mark while Left Shoulder is around $3,800-4,000 mark. If correct, bulls might be inclined to push through $3,800 mark to terminate its Right Shoulder before the next bear leg resumes.
Trading plan:
Potential drop through $2,500 from here then rally could resume toward $3,800.
Good luck!
