A selloff in Ether (ETH) on Nov. 16 has increased the chances of its price falling below $4,000.

ETH plunged 10% to around $iv,100 amid an ongoing market correction led past Bitcoin (BTC). In doing and then, Ether dropped beneath its fourth-quarter upwardly trendline back up.

ETH/USD daily cost nautical chart. Source: TradingView

ETH/USD besides tested its 50-solar day exponential moving average (fifty-day EMA; the velvet moving ridge in the chart above) as its new price floor before billowy higher. The next back up line to keep an eye on if the 50-day EMA is broken is somewhere around $iii,700.

More declines ahead?

The given ascending trendline comes as a role of a rising wedge, a technical design many analysts care for as a bearish reversal point. It appears when the price fluctuates inside a range defined past ii converging, rising trendlines.

ETH/USD daily price nautical chart featuring rising wedge setup. Source: TradingView

Meanwhile, analysts ostend a wedge breakout when the price breaks below the lower trendline and if accompanied by a rise in trading volumes. They typically eye a run down toward the level at a length equal to the widest distance betwixt the wedge'south trendlines.

Equally a result, Ether has the potential to drop below $3,000, based on the ascent wedge setup. Nonetheless, there is a take hold of.

Retesting ascending triangle resistance as support

Offsetting the bearish reversal setup brought along past the rising wedge structure is an ascending triangle, which puts Ether at effectually $6,500 past the end of 2022.

The bullish setup emerges every bit the toll of ETH retests the triangle's resistance level every bit support days later breaking above information technology. Such a move typically removes weak hands from the market and creates opportunities for traders/investors with a long-term upside outlook based on the asset's strong underlying fundamentals.

ETH/USD three-day toll chart featuring ascending triangle setup. Source: TradingView

Therefore, Ether's latest pullback may stop up exhausting as ETH price reaches the triangle resistance below $4,000 — also the ascension wedge's lower trendline. Should a rebound follow accommodate, the price could climb toward $6,500.

The views and opinions expressed here are solely those of the author and do not necessarily reverberate the views of Cointelegraph. Every investment and trading motion involves take chances, and you should conduct your ain research when making a determination.