Last week, ETH failed to chart any meaningful gains throughout the week as bears intercepted all attempts at a rally and managed to bring the price back towards the $4,000 support and hit a weekly low near the $3,916. But currently, ETH rebounds above the $4,300 mark which seems that bulls are back in control of the momentum.
The panic sales that took place on Friday in the crypto market are also associated with the main news of the week - the emergence of a new strain of COVID-19. A new strain of coronavirus known as B.1.1.529 has been found in small numbers in South Africa. The strain contains about 50 mutations, and the worst is that many of these mutations are associated with increased resistance to antibodies, which can reduce the effectiveness of vaccines.
The news about COVID-19 immediately resonated with the trade and investors began to get rid of risky assets, including cryptocurrencies.
Technical Analysis: $4,350 is A Key Resistance
On the daily price chart, we can clearly see that the price has been moving within the ascending channel for quite a long time and is currently approaching its lower border. ETH price has already surged above the Fibonacci level of 23.6%. If the ETH price continues to decline, it will test 23.6% ($4,163) mark again. The support line of the ascending channel also points to the same zone.
The daily RSI is making higher lows. This is somewhat bullish, but it is too early to get excited since the price can go either way.
The MACD is still bearish, however, the negative histogram is decreasing. So long as the price stays above $4,300, the bulls have a good chance to regain control. We should expect a rebound upward and a third wave of rally.