After surging 25% to multi-week highs, where is ETH headed? (Ethereum Price Analysis)

Following a significant rise towards the $4,000 resistance level, the native ethereum token has encountered increased selling pressure, resulting in slight consolidation.

The price is expected to fluctuate within a tight range and experience increased volatility before making its next significant move.

By shayan

The daily chart

The daily chart shows that ethereum saw renewed demand and buying pressure near the critical $3K support level, which lines up with the 0.5 ($3,133) and 0.618 ($2,906) Fibonacci retracement levels. This buying impulse sparked a notable bullish move, and many short positions were liquidated as the price approached the important $4,000 resistance zone.

However, considerable supply near this pivotal zone has increased selling pressure, leading to increased volatility and slight consolidation. A decisive break above this critical resistance could trigger a rally towards the next one around $4,500.

Despite this, the current price action indicates the likelihood of a temporary consolidation before the next major move. In this scenario, the 100-day moving average of $3,300 will serve as the main line of defense for buyers in the near term.

The 4 hour chart

The 4-hour chart takes a close look at eth's recent bullish momentum, where the price demonstrates a significant 26% rise and breaks through multiple resistance levels. However, upon reaching the crucial $4,000 resistance zone, the asset experienced increased volatility due to a large liquidation event, reflecting the ongoing battle between buyers and sellers.

Currently, eth is confined within a significant range, capped by the $4.1K resistance and the support area between the 0.5 ($3.4K) and 0.618 ($3.2K) Fibonacci levels.

If buyers break the $4,100 resistance and maintain bullish momentum, a strong medium-term uptrend could develop, potentially targeting a new all-time high. However, a period of sideways consolidation with high volatility is likely to occur before the price begins its next move.

By shayan

The perpetual futures market has been a key driver of ethereum price dynamics in recent years. Analyzing futures market metrics can provide valuable information for predicting future price movements. This chart presents the price of ethereum along with funding rates, aggregate liquidations, and open interest metrics.

The chart highlights a significant increase in the open interest metric, coinciding with a notable increase in the eth price and positive funding rate values, reaching its highest levels since April 2023. This increase in open interest indicates increased activity in the perpetual futures market, with more participants taking aggressive positions. This increase in activity is likely a major factor behind the recent impulsive price rise.

However, the $4,000 resistance level has psychological significance and potential supply, leading to high volatility. These fluctuations have led to substantial liquidations of both long and short positions, as reflected in the aggregate liquidation metric. Despite this, the overall market sentiment remains bullish and participants expect the uptrend to continue.

While market sentiment is bullish, the price may enter a phase of high volatility and sideways consolidation before making its next big move. This temporary consolidation would allow the market to absorb recent gains and set the stage for a possible continuation of the uptrend.

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