Ethereum (ETH) Faces Bearish Pressure: Is a Deeper Correction Ahead?

Ethereum (ETH) Faces Bearish Pressure: Is a Deeper Correction Ahead?

In recent trading, Ethereum (ETH) has seen its price dip to a low of $3,181.67. Currently, it is being traded at approximately $3,222.34, with daily trading volume surging by 143% to reach $28.14 billion. Along with this price movement, the market has experienced a liquidation of $156.31 million worth of ETH.

ETH price (Source: CoinGecko)

Analysts identify $3,085 as a crucial support level for Ethereum, which aligns with an upward trendline. As long as Ethereum maintains its position above this threshold, it could uphold its bullish structure and enhance the likelihood of a price breakout towards the $3.4K area. Conversely, if the price falls below this level, it may weaken market momentum and hinder any potential upward movements.

Currently, Ethereum’s price has pulled back to the $3,118 support level. The formation of a death cross could potentially lead to a further decline back to previous lows. Should ETH experience an upward move, it could rise to the resistance level at $3.3K. A successful breakthrough above this point could indicate a recovery, possibly catalyzed by a golden cross formation.

Technical Analysis Indicates Bearish Sentiment for Ethereum

The Moving Average Convergence Divergence (MACD) line for ETH is currently positioned below the zero line, confirming that the downtrend is prevailing as it trades beneath its longer-term average. While the signal line sits above the zero line, indicating that the broader trend hasn't entirely shifted to bearish, it does reflect a weakening price trend.

ETH chart (Source: TradingView)

Additionally, the Chaikin Money Flow (CMF) indicator at 0.02 has just crossed above the zero line, indicating very slight buying pressure within the Ethereum market. Although capital inflows are slightly outpacing outflows, the momentum remains weak and indecisive, suggesting a phase of consolidation rather than a robust trend.

The Bull Bear Power (BBP) metric for Ethereum is logged at -125.81, indicating significant bearish control. Sellers dominate the market, and the price is trading below this level, suggesting a strong potential for continued downside unless market momentum changes. Furthermore, the daily Relative Strength Index (RSI) stands at 41.37, below the neutral 50 mark, which denotes bearish momentum. Since ETH is not currently oversold, there is room for further short-term consolidation.

Key Takeaways:

Ethereum's price has dropped to around $3,222.34, with heightened trading volume.
$3,085 is identified as a key support level for ETH; holding it may lead to bullish price movements.
Technical indicators point to bearish sentiment, with MACD and BBP suggesting strong selling pressure.
A rise above $3.3K could signal a potential recovery, contingent on market momentum.

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