Ethereumโs Price Consolidation Following Recent Drop
Ethereumโs price has yet to show any indicationsย of recovery after a wholeย lotย of fall from the critical $2,000 resistance level. Althoughย while the digitalย currency is asย ofย now consolidating within a narrow range, there are indicators that suggest probable price movements in the short term.
Technical Analysis: Daily Chart
On the daily timeframe, Ethereumโs price has been holding around the $1,650 levelย ofย support in the past few days, following a strong rejection from $1,750. Considering theย present price behavior and overall market structure, it is more likely that the price will experience a further decline towards the $1,400 level rather than a rebound towards $2,000. Inย addition, the bearish crossover of the 50-day and 200-day moving averages signals a negative trend that could lead to another collapse soon.
Technical Analysis: 4-Hour Chart
Examining the 4-hour timeframe, the momentum is clearly favoring sellers, and the price has been struggling with the $1,650 levelย ofย support. A breakdown below this level seems more probable. The RSI indicator likewise indicates bearish momentum in this timeframe, increasing the chances of a further decline. Nonetheless, if the $1,650 level holds and pushes the price over the $1,750 resistance zone, this scenario may fail.
On-Chain Analysis: Ethereumย (ETH) Funding Rates
Regardlessย of the recent bearish trend, analyzing the futures market can provide insights into short-term price expectations. The Ethereumย (ETH) funding rates metric represents periodic payments to traders based on the difference between perpetual contract markets and spot prices. Positive funding rates indicate positiveย trend sentiment, while negative rates indicate bearish expectations. Regardlessย of the price decrease, the funding rates for Ethereumย (ETH) remain positive, suggesting that futures traders are still hopeful for a probable rally. Nonetheless, positive funding rates could trigger a long liquidation cascade, leading to another decline.
Hot Take
Althoughย while Ethereumโs price is asย ofย now consolidating and showing some indicationsย of probable recovery, technical analysis and on-chain indicators suggest a more bearish outlook. Traders should be cautious and closely monitor price movements for probable further declines. Positive funding rates in the futures market may indicate optimism, but they likewise carry the risk of a long liquidation cascade. Stay notified and consider these factors when making investment decisions.
Owen Patter is a distinguished crypto analyst, accomplished researcher, and skilled editor, leaving a notable imprint on the cryptocurrency landscape. As a proficient crypto analyst and researcher, Owen delves into the intricate realms of digital assets, offering insights that resonate with a diverse audience. His analytical acuity is harmoniously paired with adept editorial skills, allowing him to transform complex crypto information into easily comprehensible content.
