ethereum price has been consolidating in a wide range above the $2,000 mark. However, things could change soon.
Technical analysis
By Edris Derakhshi (TradingRage)
The daily chart
On the daily chart, the price has been moving sideways in a range of $500 between the resistance level of $2,700 and the support zone of $2,200.
Given that the market is testing the upper limit several times and failing to break above it, the target seems likely to be $2,200 in the coming weeks. On the other hand, the RSI is approaching the 50% level from below, suggesting that the bearish momentum is fading, which could also result in a reversal soon.
The 4 hour chart
The 4-hour chart shows a much more meaningful picture of the recent price consolidation. The market has been trapped in a large symmetrical triangle pattern and every limit has been tested twice.
However, with the $2,500 level breaking down and being retested from below, the market is likely to test the lower trendline soon.
Sentiment analysis
By Edris Derakhshi (TradingRage)
ethereum Open Interest
This chart displays the open interest (OI) metric, which shows the total number of outstanding futures contracts. It reflects the level of trader participation and market activity: rising OI indicates increased interest and falling OI suggests traders are closing their positions or being liquidated.
The chart shows that OI and ethereum price are moving closely together, with a significant increase from late 2023 to early 2024, indicating high market participation and bullish sentiment.
However, the sharp drop in mid-2024 suggests a major bearish event or liquidation, causing traders to exit their positions, leading to reduced market activity and a drop in prices.
Despite some fluctuations, both OI and price remain lower than previous peaks, reflecting a more cautious sentiment among traders. However, with such a cooldown in the futures market, sufficient spot demand can initiate a sustainable rally.
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Cryptocurrency charts by TradingView.
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