ETH Risks Falling Below $3K After Recent Rejection – Crypto News – Crypto News
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ETH Risks Falling Below $3K After Recent Rejection ETH Risks Falling Below $3K After Recent Rejection

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ETH Risks Falling Below $3K After Recent Rejection – Crypto News

Published

1 year ago

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Ethereum experienced a surge this week, briefly breaking above a key resistance region. However, it lacked sufficient momentum, appearing to be a false breakout.

If ETH faces a more profound rejection at current levels, lower prices could follow.

Technical Analysis

By Shayan

The Daily Chart

Ethereum saw a strong push from buyers at the $3K support range, driving the price slightly above a substantial resistance region. This key region includes:

  • The 100-day moving average at $3.3K
  • The bullish flag’s upper boundary at $3.4K

Despite clearing these levels, ETH encountered significant selling pressure at $3.5K, highlighting insufficient buying power. This false breakout raises concerns about a potential rejection.

Continuing the bullish trend will be possible if the asset successfully breaks above these key thresholds and ultimately reclaims the $3.5K juncture. Otherwise, a rejection could lead to heightened volatility and a potential price drop.

The 4-Hour Chart

On the lower timeframe, ETH gained momentum after bouncing from the 0.5-0.618 Fibonacci retracement zone, successfully breaking above a descending wedge pattern. Such a breakout often signals a potential bullish continuation, shifting sentiment in favor of buyers.

However, upon reaching the critical $3,5K resistance, Ethereum encountered significant selling pressure, triggering a retracement toward the previously broken trendline of the wedge.

The upcoming price action will be crucial; if Ethereum finds support at this trendline and completes a pullback, the bullish structure could remain intact, leading to another push toward $3.5K. Conversely, if demand remains weak and buyers fail to step in, the market could face a deeper correction, potentially targeting the $3K support level again.

Onchain Analysis

By Shayan

The Binance liquidation heatmap offers valuable insights into areas where substantial liquidation events are likely to occur. As liquidity tends to act as a price magnet, these levels often become focal points for market movements, with traders seeking to capitalize on liquidity sweeps.

Recent market consolidation has resulted in the formation of a significant cluster of liquidation levels just above the key $3.5K resistance. These levels correspond to short-position liquidation levels, making them an attractive target for bulls and institutional buyers. Given this setup, Ethereum’s price could be drawn toward this liquidity pocket, increasing the probability of a breakout above $3.5K in the mid-term.

Despite the current lack of strong bullish momentum, the $3.5K level remains a crucial battleground. A decisive move above this resistance to trigger short liquidations could act as a catalyst for further upside, potentially propelling Ethereum toward the psychological $4K mark in the coming sessions.

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Cryptocurrency charts by TradingView.

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