The Critical Point for Ethereum’s Price
After weeks of rejection and bearish developments, the price of Ethereum has reached a crucial point near a pivotal support area, specifically the 61.8% Fibonacci retracement level. Fortunately, the price has rebounded from this zone, providing hope amidst the prevailing bearish sentiment and suggesting the possibility of a temporary consolidation phase.
Technical Analysis: The Daily Chart
Ethereum’s price has been in a prolonged downtrend, breaking multiple support levels, including the crucial 100 and 200-day moving averages. However, it has encountered a critical support zone between the 50% and 61.8% Fibonacci retracement levels. This range is seen as the final defense for Ethereum bulls. If the price drops below this threshold, it could lead to a significant downward plunge.
Additionally, a death cross event occurred as the 100-day moving average crossed below the 200-day moving average, signaling strong bearish sentiment. Despite these indicators, there is still hope for a consolidation phase around the moving averages.
The 4-Hour Chart
On the 4-hour timeframe, Ethereum experienced a consolidation phase within the $1.6K-$1.8K price range. A bearish flag pattern formed during this period, and when the price broke below the lower trendline of the flag, it triggered a significant downward movement.
However, buying pressure intensified as Ethereum approached the critical support level at $1.5K, resulting in a rebound and potentially forming a pullback towards the lower threshold of the broken flag. The success or failure of this pullback will determine whether Ethereum continues its downward phase or surges towards the $1.7K resistance level.
On-chain Analysis
The Taker Buy Sell Ratio metric, along with Ethereum’s price, indicates whether buyers or sellers are aggressively executing orders. Despite the recent downtrend and repeated rejection around the $2,000 resistance level, there has been a notable surge in this metric, suggesting a potential shift towards a more bullish sentiment among market participants.
If this upward trajectory continues and the metric enters positive territory, it could signal a new phase of bullish price action for Ethereum, potentially targeting higher resistance levels.
Hot Take: Bounce to $2K or More Pain for Ethereum?
After facing rejection and bearish developments, Ethereum’s price has reached a critical point near a pivotal support area. The rebound from this zone provides hope for a temporary consolidation phase. However, the price must be closely monitored as it approaches significant support and resistance levels. Technical analysis indicates that the price could either bounce towards $2K or experience further downward pain. On-chain analysis suggests a potential shift towards bullish sentiment. The upcoming price action will likely determine Ethereum’s mid-term trajectory.
Source: CryptoPotato
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