After breaking above the 100-day moving average and pulling back in pullback fashion, Ethereum price kicked off a rally reaching the $2K resistance level. However, it has now stopped temporarily, giving rise to a consolidation phase around this crucial resistance.
Technical analysis
By Shayan
the daily chart
Ethereum price successfully broke above the 100-day moving average and the upper trend line of the descending channel, then retested them during a pullback. This led to further buying pressure and a significant rise in prices, reaching the critical $2K resistance region.
However, due to the prevailing selling pressure around this vital level, the price faced rejection and began to consolidate. Notably, the $2K zone aligns with a previous major shift in Ethereum’s value, making it a formidable barrier.
The 4 hour chart
Looking at the 4 hour time frame, it becomes apparent that the momentum of the rally has weakened and the price has formed a bearish head and shoulders reversal pattern. This suggests a bearish outlook for the price in the near term, which could lead to minor rejections.
On the other hand, as a result of the recent price decline, Ethereum has reached an uptrend line (indicated in green) and is about to break below it. If the price breaks below the trend line, which is currently acting as support, a cascade towards the significant $1.7K support zone is very likely.
Ultimately, Ethereum price appears to be confined within a static range between the $2K resistance and $1.7K support zones, consolidating for the medium-term outlook.
chain analysis
The Ethereum price has recently experienced a significant bullish move after a period of consolidation. This bullish momentum is likely to attract the attention of investors and traders, especially those involved in the perpetual futures market who engage in speculative trading.
The open interest metric, which measures the number of active futures positions, has shown a slight increase and reached its two-month high. This suggests that there could be greater market volatility due to a greater possibility of liquidation of both long and short positions.
Consequently, it seems reasonable to anticipate a continued uptrend in the medium term, as the futures market has not yet reached a state of overheating. However, it is important to consider that this potential uptrend may also coincide with increased volatility characterized by sudden and significant price fluctuations.
It is worth noting that unforeseen events could alter the current scenario and impact market dynamics. Therefore, it is essential to monitor any developments that could influence Ethereum price movement and market sentiment.
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