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Ethereum falls after breakout from contracting triangle
The move pushed ETH/USD into a lower support zone between $1,894 and $1,854, with higher sell volume noted at the break.
Investor sentiment in crypto received a lift after reports suggested progress in talks involving Iran and Oman around a possible new route through the Strait of Hormuz, easing fears of energy supply disruptions, Action Forex reported.
Despite that backdrop, the ETH/USD chart deteriorated, with Ethereum topping near $1,975 in late July before forming a contracting triangle pattern. On 10 August, a large red candle broke below the triangle’s lower boundary and below the current market profile lower boundary at $1,894, setting up a downside move.
Action Forex said the price then moved into the zone between the lower profile boundary and a green support level at $1,854. It added that continued selling pressure could drive a test of that area, while a return into the prior profile range would shift focus to the point of control at $1,915 and the upper profile boundary at $1,925.
The outlet also pointed to the breakout being accompanied by increased volume, suggesting stronger selling activity. It cited RSI and moving-average readings of 32, 52, and 53, noting the oscillator has left the neutral zone and that moving averages remained some distance from crossing below a lower boundary.