After surging 25% to multi-week highs, where is ETH headed? (Ethereum Price Analysis)

After a significant rally towards the $4,000 resistance level, Ethereum’s native token has seen increased selling pressure, leading to a slight consolidation.

The price is expected to fluctuate within a narrow range and experience greater volatility before making its next significant move.

By Shayan

The daily chart

The daily chart shows that Ethereum experienced renewed demand and buying pressure near the critical support level of $3,000, which aligns with the Fibonacci retracement levels of 0.5 ($3133) and 0.618 ($2906 ). This buying momentum led to a notable move to the upside, with many short positions being liquidated as the price approached the substantial resistance zone at $4,000.

However, sizable supply near this key area has increased selling pressure, leading to higher volatility and slight consolidation. A decisive break above this critical resistance could trigger a rally towards the next one around $4.5k.

Despite this, the current price action indicates the likelihood of a temporary consolidation before the next major move. In this scenario, the 100-day moving average at $3.3K will serve as the main line of defense for short-term buyers.

The 4 hour chart

The 4-hour chart takes a close look at ETH’s recent bullish momentum, with the price demonstrating a significant 26% increase and breaking through multiple resistance levels. However, upon reaching the crucial $4,000 resistance area, the asset experienced increased volatility due to a large liquidation event, reflecting the ongoing battle between buyers and sellers.

ETH is currently in a major range, bounded by the resistance at $4.1K and the support area between the Fibonacci levels of 0.5 ($3.4K) and 0.618 ($3.2K ).

If buyers breach the $4.1k resistance and maintain bullish momentum, a strong medium-term uptrend could develop, aiming for a new all-time high. However, a period of sideways consolidation with high volatility is likely before the price begins its next move.

By Shayan

The perpetual futures market has been a key driver of Ethereum’s price dynamics in recent years. Analysis of futures market metrics can provide valuable information for predicting future price movements. This chart presents the price of Ethereum along with funding rates, aggregate settlements and open interest metrics.

The chart highlights a significant increase in the open interest metric, coinciding with a notable increase in the ETH price and positive funding rate values, which reached their highest levels since April 2023. This increase in open interest indicates increased activity in the perpetual futures market, with more participants taking aggressive positions. This increase in activity is likely a major factor behind the recent impulsive rise in prices.

However, the $4,000 resistance level has psychological significance and potential supply, leading to high volatility. These fluctuations have resulted in substantial liquidations of both long and short positions, as reflected in the aggregate liquidation metric. Despite this, overall market sentiment remains bullish, and participants expect the upward trend to continue.

Although the market sentiment is bullish, the price may enter a phase of high volatility and lateral consolidation before making the next big move. This temporary consolidation would allow the market to absorb recent gains and set the stage for a possible continuation of the uptrend.

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