ethereum price has been falling rapidly over the past few weeks since the rejection of the $3,500 resistance level.
However, the price may bottom out soon.
Technical analysis
The daily chart
On the daily time frame, the price has been falling aggressively after breaking below the 200-day moving average, which is around the $3,200 mark.
The $3,000 and $2,700 levels have been lost as the price has even tested the $2,200 support zone.
However, yesterday’s price action was significantly bullish, raising speculations about whether the market will experience a V-shaped recovery. Currently, the $2700 resistance level is holding the price, preventing it from rising further. Therefore, a consolidation could occur in the near term before any significant movement takes place.
The 4-hour chart
On the 4-hour time frame, the price has rebounded from the $2,200 region and is testing the $2,700 resistance level. The RSI has also rebounded above the 50% threshold, which indicates that the momentum is bullish on this time frame.
Therefore, if the price breaks the $2,700 level, the market can rise towards the $3,000 resistance zone and a complete recovery could be expected for ethereum.
On-chain analysis
ethereum Exchange Reserve
In the face of the massive drop in the price of ethereum, many investors gave up and sold their coins at a loss. However, a period of accumulation may be beginning as some participants consider eth to be oversold.
This chart shows the bitcoin exchange reserve metric, which measures the amount of btc held in exchange wallets. Rising values indicate that investors are depositing their coins on exchanges to sell, and decreasing values indicate an accumulation phase.
Looking at the chart, the exchange reserve metric has seen a gradual rise following the recent drop, pointing to capitulation by investors. However, with the market showing signs of recovery, the exchange reserve is once again falling below its 30-day moving average, pointing to increased demand. If this trend continues, ethereum could recover soon.
ethereum Price Analysis: Is Another Correction Imminent for eth or $3,000 is Coming? The post first appeared on CryptoPotato.
