Technical outlook:
Ethereum has bounced back after finding support from $2,950 mark on Wednesday. The crypto has managed to produce a potential Morning Star candlestick pattern after testing the Fibonacci 0.50 retracement of its recent upswing between $2,300 and $3,500 levels respectively. Bulls will be inclined to push prices through $3,800-4,000 range going forward.
Ethereum had earlier dropped from $4,850 high through $2,100 low, carving a meaningful downswing. Since then, the crypto has been unfolding a counter trend rally towards $3,800 mark at least. The counter trend seems to be into its last wave and could terminate prices close to $3,850 mark before giving in to bears.
Also note that $3,800 is converging with the parallel channel resistance and fibonacci 0.618 retracement of the above downswing. High probability remains for a bearish reaction if prices manage to reach there. Ethereum can be expected to drag lower below $2,100 mark in the next several trading sessions.
Trading plan:
Potential rally through $3,800-4,000 zone against $2,100. Then lower again.
Good luck!
