An influx of buying pressure, which hasn’t been witnessed in weeks, is crucial to rejuvenate bullish hopes for Ethereum. The battle to reclaim the $3.4k price level is intensifying, and investors are on the edge of their seats, eager to see what unfolds next.
As it stands, Ethereum [ETH] has been struggling. The daily chart reveals a bearish structure with a significant drop below the $3.4k support zone. This decline has cast a shadow over the market, making many traders feel uneasy. The absence of buying pressure over the past month has been a worrying indicator, leading to some uncertainty about the coin’s performance.
However, if we zoom out to the two-week timeframe, there’s a silver lining. Ethereum has formed an inverse head and shoulder pattern, considered a strong bullish sign for longer time frames. If this pattern is confirmed with a breakout, it could potentially propel Ethereum prices toward an astonishing $12,000.
On the daily chart, the situation is less rosy. On December 19th, Ethereum’s price fell below $3,509, triggering a bearish market shift. The RSI also slipped beneath the neutral mark of 50, reinforcing the bearish sentiment. The On-Balance Volume (OBV) has stalled for two months, indicating a lack of enthusiasm among buyers. This analysis suggests that further losses might be on the horizon.
The previous support level of $3.4k has now been transformed into a formidable resistance zone. Ethereum faced rejection when it attempted to test the $4k resistance after a rally from around $3k. This struggle to break free from bearish territory has left many wondering about the next steps.
For those trading at lower timeframes, the $3,314 level has shown some support and could lead to a minor price bounce of about 3.4%-5.8%. However, this alone is unlikely to shift the daily bias back to bullish. Realistically, an influx of buying pressure is essential to ignite renewed optimism in the market.
In summary, while the fight to reclaim $3.4k intensifies, the overall sentiment leans more towards caution. Investors are advised to keep a close eye on the market dynamics and identify potential buying opportunities that could present themselves if bullish momentum starts to gather pace. As always, trading and investing in cryptocurrency involves risks, and it’s wise to conduct thorough research or consult with experts as navigating this market can be challenging.
