Ethereum price is struggling to break above a key resistance level after a substantial rally in recent months. However, there are multiple levels of support that could hold the price in the event of a reversal.
Technical analysis
By: Edris
the daily chart
On the daily time frame, the price failed to break above the $1800 level and the upper bound of the Large Symmetrical Triangle pattern.
The cryptocurrency appears to be facing downside rejection at the moment, with 50-day and 200-day moving average lines available as potential support levels around $1,550 and $1,400. Also, should the market pull back further, the $1300 support zone would be a key area to watch.
The 4 hour chart
Looking at the 4 hour chart, the recent price action becomes clearer. ETH is currently breaking below the $1650 support area, which could lead to a deeper drop towards the $1500 level any time soon if a valid break occurs.
The RSI indicator has also dipped below the 50% threshold, which points to current seller dominance and bearish momentum. However, the price could still move higher if the $1650 level holds. This could potentially lead to a break above the upper limit of the triangle and a retest of the $1800 resistance area in the coming days.
sentiment analysis
By Shayan
Since 2018, the futures market has been instrumental in affecting the price of Ethereum. Therefore, examining your sentiment would be useful to gain insight into short-term price movements.
The Taker Buy Sell Ratio metric (with an added 30-day SMA) can be used to define the market outlook. Using this function, we can identify whether buying or selling pressure is significant, with values above one indicating bullishness and values below 1 indicating bearish sentiment.
Concurrent with Ethereum’s recent uptrend, the metric shot up, indicating bullish sentiment in the market. However, the price entered a consolidation stage, causing a significant drop in the metric below one. As a result, it fell to a new multi-month low, implying prevailing bearish sentiment.
The recent rally should be closely monitored in the coming weeks to determine if this was just another bull trap or the start of a new bull market, as sellers could once again dominate.
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