ETH Pops Above $2K But Are the Bears Gone for Good? (Ethereum Price Analysis)

Technical Analysis

By GreatestTrader

Ethereum’s recent forceful upswing encountered resistance upon reaching a critical price region, encompassing the $2K threshold and the upper boundary of an ascending wedge.

This resulted in a phase of consolidation correction, retracing towards the 100 and 200-day Moving Averages (MAs).

A comprehensive analysis of the daily chart exposes a notable presence of supply in the crucial $2K region, coinciding with the upper boundary of the multi-month wedge.

The selling pressure in this pivotal resistance zone disrupted the significant upward momentum, ushering in a phase of consolidation correction within the market.

Considering the significance of the $2K resistance and the upper boundary of the associated wedge pattern, there is a high likelihood of a temporary extension of the ongoing retracement, followed by consolidation around the breached moving averages.

If the price completes a pullback to these moving averages, it could prompt buyers to re-enter the market with the objective of once again challenging the substantial $2K level.

Source: TradingView

On the 4-hour chart, it is evident that Ethereum’s robust uptrend lost steam upon encountering the critical resistance at $2K. This region represents a pivotal psychological barrier, creating obstacles for buyers aiming to propel the price higher due to a notable supply presence, indicating heightened selling pressure in this key area.

Following a rejection near the $2K resistance zone, the price entered a consolidation correction phase, forming a bullish flag pattern. This well-known technical pattern implies a potential continuation of the initial uptrend, contingent on a successful breach of its upper boundary.

Given the current market dynamics, there is a considerable likelihood of an extended consolidation correction phase in the short term, targeting the support range between the 0.5 and 61.8 levels of the Fibonacci retracement ($1,839 – $1,769).

However, in the event of a sudden breakout above the flag’s upper boundary, the market could experience a substantial surge, with the objective of reclaiming the decisive $2K resistance zone.

Source: TradingView

By GreatestTrader

In the wake of Ethereum’s recent price surge, market participants have embraced an optimistic outlook for the medium-term future. This positive sentiment has triggered substantial buying activity across both the spot and futures markets.

The accompanying chart illustrates the funding rates, a crucial metric for gauging sentiment in the futures market. Positive values indicate a bullish sentiment, while negative values are associated with a bearish sentiment. Notably, the funding rates have consistently exhibited elevated values in recent weeks. However, a noticeable decline has emerged concurrently with a retracement in Ethereum’s price. This shift suggests a temporary pause in the futures market, poised for a potential fresh and impulsive move.

Despite this, investors should be careful, considering the recent price downturn may signify the onset of a more extensive bearish phase, potentially leading to the liquidation of a significant number of long positions.

Source: CryptoQuant

Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).

Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.

Cryptocurrency charts by TradingView.

Source link

About The Author

Scroll to Top