Ethereum price action has been very choppy in recent weeks after facing rejection of significant resistance. However, there are multiple levels that could provide support and hold the price in the event of a deeper pullback.
Technical analysis
By: Edris
the daily chart
On the daily chart, the price was rejected from the $1800 level and the upper limit of the large symmetrical triangle pattern in early February. Since then, it has broken below the 50-day moving average, located around the $1,600 mark.
Currently, the price is consolidating below the broken moving average and is yet to show an impulsive move after the breakout. If the cryptocurrency fails to recapture the broken 50-day moving average, the 200-day moving average, trending around the $1,400 level, could be the next support, closely followed by the $1,300 static zone.
On the other hand, a break above the 50-day moving average would likely lead to an eventual break above the symmetrical triangle and a rally to the upside in the short term.
The 4 hour chart
Looking at the 4-hour time frame, it is evident that the price has been oscillating in a very tight range following an impulsive rejection of the $1650 resistance level a few days ago. $1500 is likely to be tested in the short term, and if it fails to hold the market, the price could drop towards the next support area, which is around the $1350 mark.
The RSI indicator is also moving sideways but is still showing values below 50%, which points to bearish momentum and further increases the probability of a bearish continuation in the coming days.
sentiment analysis
Ethereum Taker Buy and Sell Rate (SMA 100)
Given that the Ethereum price has been consolidating below significant resistance levels in recent weeks, it would be useful to gauge futures market sentiment to gain more insight into what the market would do next.
The Taker Buy Sell Ratio is one of the most useful metrics for achieving this, as it measures whether bulls or bears are currently executing their trades more aggressively. Values above one indicate dominant buying pressure, while values below 1 are associated with negative sentiment.
This metric has been trending lower for the past several weeks, indicating that buying pressure is fading in the futures market, and recent consolidation price action also validates this interpretation.
However, the metric is currently approaching the 1 threshold, and a drop below would mean that the bears are in control once again, which could lead to a price decline in the coming weeks if this trend continues.
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