Is ETH about to fall below $3,000 or will the bulls intervene? (Ethereum Price Analysis)

After a period of consolidation near the critical support marks defined by the 0.5 and 0.618 Fibonacci retracement levels, along with the 100-day MA, ethereum witnessed a modest bullish bounce.

However, it still faces a notable resistance range, the breaking of which has the potential for renewed bullish momentum.

By shayan

The daily chart

Examining the daily chart, it is evident that ethereum's extended consolidation phase is close to fundamental support levels.

These points, marked by the 0.5 ($3,139) and 0.618 ($2,910) Fibonacci retracement levels, along with the crucial 100-day MA, culminated in a slight bullish recovery. This consolidation also coincided with the lower boundary of the multi-month falling wedge pattern, which typically indicates bullish continuation.

However, ethereum now faces a formidable resistance zone encompassing the upper boundary of the wedge and the critical $3,400 mark. A successful breakout of this resistance could pave the way for a significant bullish rise towards the $4.1K threshold.

On the contrary, if the selling pressure is not overcome, the consolidation phase could continue within the upper boundary of the wedge pattern and the 100-day moving average.

The 4 hour chart

Analysis of the 4-hour chart reveals the sideways movement of ethereum near the lower boundary of the wedge pattern, corresponding to the $3K support region.

During this phase, ethereum formed an inverted head and shoulders pattern, suggesting a possible bullish reversal. However, the price rose above the pattern neckline at $3,300 but was subsequently rejected, indicating a false breakout.

Given the recent price action and prevailing market sentiment, ethereum appears poised to continue its consolidation within the price range bounded by the $3,400 resistance region and $3,000 support. A successful breakout of this decisive range could herald a new price trend in the medium term.

By shayan

Following ethereum's recent rejection from the high of $3,300, investors can turn their attention to the behavior of traders in the futures market. The chart provided illustrates the liquidation heatmap for the Binance eth/USDT pair, showing price levels with significant liquidity capable of influencing the price trend.

It is evident that the sharp decline below the critical level of $3,000 resulted in the liquidation of a substantial number of long positions, triggering a cascade of sell orders. However, since then, the price has been experiencing corrective pullbacks, causing the futures market to cool down in recent weeks.

Consequently, there are currently no notable levels of liquidity coming ethereum's way in any direction in the near term. As a result, the market appears primed for a renewed sentiment-driven impulsive move in the futures market.

Barring any unexpected developments in the short term and considering the increased demand for ethereum, the price may set its sights on liquidity above the $4,000 level in the long term.

<!– ai CONTENT END 1 –>