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Ethereum (ETH) Back Below $3K, Why Rally Isn’t Over Yet

Ethereum Rally

Ethereum started a strong rally above the $3,000 resistance against the US Dollar. ETH price is now correcting gains, but it is likely to find bids near $2,840.

Ethereum gained pace after it broke the key $2,840 resistance zone.
The price is now trading above $2,900 and the 100 hourly simple moving average.
There was a break below a key bullish trend line with support near $2,980 on the hourly chart of ETH/USD (data feed via Kraken).
The pair is correcting gains, but there is a strong support waiting near $2,800.

Ethereum Price Corrects Gains
Ethereum started a strong rally above the $2,700 and $2,850 resistance levels. ETH price even broke the $3,000 barrier and it settled nicely above the 100 hourly simple moving average.
It traded to a new multi-week high at $3,190 before there was a downside correction. The price traded below the $3,000 support zone. There was a break below the 23.6% Fib retracement level of the recent surge from the $2,725 swing low to $3,190 high.
Besides, there was a break below a key bullish trend line with support near $2,980 on the hourly chart of ETH/USD. Ether is now trading above $2,900 and the 100 hourly simple moving average.
It is finding bids near the 50% Fib retracement level of the recent surge from the $2,725 swing low to $3,190 high. On the upside, an immediate resistance is near the $3,000 level. The next key resistance is near the $3,050 level.

Source: ETHUSD on TradingView.com
A clear break and close above the $3,000 and $3,050 resistance levels might start another increase. In the stated case, the price could rally above $3,200. The next stop for the bulls may possibly be near the $3,400 level.
Dips Limited in ETH?
If ethereum fails to continue higher above the $3,000 and $3,050 resistance levels, it could start an extended downside correction. An immediate support on the downside is near the $2,900 level.
The next major support is near the $2,840 level. It is near the 76.4% Fib retracement level of the recent surge from the $2,725 swing low to $3,190 high. Any more losses could lead the price towards the $2,740 support zone.
Technical Indicators
Hourly MACD – The MACD for ETH/USD is slowly losing pace in the bearish zone.
Hourly RSI – The RSI for ETH/USD is now below the 50 level.
Major Support Level – $2,840
Major Resistance Level – $3,050