Ethereum Price Rejected Again — Is Another Leg Lower Brewing?

Overview

Ethereum has entered a phase of decline, trading below the $1,980 mark. The cryptocurrency is currently consolidating but remains at risk of falling further, potentially dipping below the $1,920 support level. This recent trend follows a failure to maintain gains above the $2,000 threshold, raising concerns among traders and investors.

Ethereum’s Current Price Action

Ethereum’s price has recently struggled to maintain upward momentum, specifically failing to hold above the $2,000 mark. This inability to sustain gains has resulted in a fresh decline, with ETH trading below both the $1,980 and $1,960 levels, indicating a shift into a bearish zone.

The decline is notable as it also reflects a broader trend seen with Bitcoin, which has similarly faced challenges. Ethereum’s price has dipped below the 50% Fibonacci retracement level of its previous upward movement, which ranged from a swing low of $1,745 to a high of $2,168. This suggests that the bearish sentiment is gaining traction, with sellers pushing the price closer to key support levels.

A bearish trend line is forming, presenting resistance at the $1,960 level on the hourly chart. As Ethereum currently trades below the 100-hourly Simple Moving Average, it signifies a lack of buying pressure needed to reverse the downward trend.

If Ethereum remains below the $2,000 zone, the potential for a fresh decline increases. Immediate resistance can be found near the $1,960 level, while the first key resistance level sits at $2,000. Should the price manage to break above these barriers, the next significant resistance levels are at $2,050 and $2,150. A move beyond $2,150 could pave the way for further gains in the future.

Conversely, if Ethereum fails to overcome the $1,960 resistance, it could experience a decline. Initial downside support is found around the $1,920 level, with further major support at the $1,900 zone, which also aligns with the 61.8% Fibonacci retracement level of the previous upward move. A clear move below $1,900 could lead to a drop towards the $1,845 support, and further losses might push the price down to the $1,800 region, with the main support level identified at $1,750.

From author

The current state of Ethereum’s price reflects a cautious sentiment among traders as the cryptocurrency struggles to regain lost ground. The technical indicators suggest a bearish outlook, and the formation of resistance levels indicates potential challenges ahead for bulls looking to initiate a recovery.

Given the pivotal support and resistance levels outlined, market participants will be closely monitoring Ethereum’s price action to gauge the likelihood of a rebound or further decline. The interplay between buying and selling pressure in the coming sessions will be critical in determining the near-term trajectory of ETH.

Impact on the crypto market

• Ethereum’s struggle to maintain the $2,000 level could instill caution among investors, potentially leading to reduced trading volumes.
• A decline below key support levels may trigger increased selling pressure, impacting overall market sentiment.
• The correlation with Bitcoin’s performance suggests that both cryptocurrencies may be influenced by similar market dynamics.
• Resistance levels near $1,960 and $2,000 could serve as critical benchmarks for traders, influencing short-term trading strategies.
• A continued decline in Ethereum’s price could affect the broader altcoin market, leading to increased volatility across various cryptocurrencies.