Ethereum price has been consolidating for the past week as the price is struggling to break above a key resistance area. Did ETH score a local top?
Technical analysis
By: Edris
The daily chart:
On the daily time frame, the price of ETH has recently broken above the symmetrical triangle pattern and above the 50-day SMA line (around the $1600 mark). However, ETH is trading within a very tight range above the broken triangle and has yet to confidently break above the $1800 level.
If the market fails, a pullback could be expected towards the 50-day and even 200-day moving average located around the $1600 and $1400 levels respectively. On the other hand, a valid break above the $1800 level could lead to another short-term rally, first to target the $2K level for the first time in 2023, and then another target in the $2300 area.
The 4 hour chart
On the 4-hour chart, the consolidation becomes more apparent as the price has been bouncing around the $1800 resistance level. The RSI indicator has been signaling a clear bearish divergence signal for a while, which could point to a pullback in the coming days.
In this case, the $1650 level could be retested for support, followed by the $1500 level. However, it is still too early to predict whether the uptrend will continue or reverse as the market has yet to make up its mind amid the $1800 resistance.
chain analysis
By: Edris
Ethereum open interest
Ethereum price has risen steadily in recent months, following a reversal around the $1000 support mark. However, the futures market behaves quite differently than the few times before when the market saw rallies to short term during the recent bear market.
The open interest (OI) metric measures the daily number of open futures contracts and is a useful indicator for gauging futures market sentiment. Generally, upside open interest is followed by high volatility and bearish reversals. However, open interest has remained relatively low during the recent rally.
As a result, the uptrend could still hold, as there is less chance of long sell-off cascades any time soon. Note: The spot market should also be considered to make more accurate predictions.
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