Ethereum recently showed a bullish signal by finding support at the 100-day moving average of $1,791 and saw its price rise. Furthermore, it has now found a crucial resistance level, and breaching it would likely trigger another rally.
Technical analysis
By Shayan
the daily chart
Ethereum had a period of consistent price action around the 100-day moving average of $1,790 before finding support and moving higher.
However, during the recent consolidation correction phase since mid-April, the price formed a falling wedge pattern (marked in yellow).
Currently, the price has reached the upper limit of the wedge at $1.9K due to its recent rise and is about to break above this critical level.
Ethereum price is currently confined within a tight range, between roughly $1,791 and the $2K static resistance zone. A break of the wedge is likely to trigger another rally towards the $2K resistance zone.
The 4 hour chart
Zooming in on the 4-hour chart, we can identify three crucial price regions: static resistance at $2K, dynamic resistance at the midpoint of the rising channel trend line, and static support at $1710.
Based on the current price action, it seems more likely that the price will continue its uptrend towards the $2K resistance and try to break out. However, considering the current market conditions and the uncertainty prevailing among the participants, a consolidation phase is also likely between the $2K resistance and the $1710 support regions.
chain analysis
Price fluctuations in the market are the result of the dynamic interaction between the forces of supply and demand. Demand plays a crucial role among these forces, and closely monitoring the behavior of market participants is essential to assess existing demand.
An effective way to gain insight is to look at the Active Addresses metric. Measures the total number of unique active addresses, including senders and recipients. During the recent consolidation phase, it has fallen into a downward trend, indicating declining demand and a period of uncertainty among market participants.
Furthermore, the metric has recently reached its lowest point of the year, which suggests that the current level of demand is insufficient to signal the start of the next bull run. As a result, the market needs more activity to start a healthy bullish cycle. This could potentially be achieved if the price successfully breaks out of the significant resistance region at $2K.
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