Ethereum increased significantly in the first part of the yesterday’s trading session and reached historical highs, but failed to stay higher and now is trading in the red. Price plunged in the US session and erased the latest gains. Remains to see what will really happen because has tested two very important downside obstacles. I’ve said in the previous reports that the cryptocurrency may find temporary resistance and could drop on the short term.

Technically, the current drop was natural after the impressive rally, remains to see how long the corrective phase will be because this could be only temporary before the rate will start another upside momentum. Bitcoin plunged as well in the yesterday’s US session, from 11336 historical high to 8986 level in only 6 hours.

Ethereum and Bitcoin recovered a little in the morning, but the bears are still present in the game, the cryptocurrencies stand above some crucial support levels.

You can see that the rate has climbed much above the inside sliding line (SL) of the ascending pitchfork, but we had only a false breakout signaling that the bears could take the lead. Ethereum dropped below the median line (ML) of the ascending pitchfork and below the 415 static support. Only a valid breakdown below these levels will confirm a larger drop in the upcoming period.

You can see that the rate has made a false breakdown through the confluence between the 415 with the median line (ML), meaning that it could turn to the upside very soon. A retest of the median line (ML) could bring us a great buying opportunity with a first target at the sliding line (SL) of the ascending pitchfork.

Personally I’m curious to see what will happen in the upcoming period because the rate failed to close right on the sliding line (SL), this could be a larger drop signal, but we still need a confirmation.