The Ethereum (ETH) price has recently experienced an uptick in demand, particularly noticeable around the $2200 level. This change is highlighted by distinct long-tail rejection candles observed on its daily chart, indicating a decrease in bearish momentum. This shift comes in tandem with the Bitcoin price stabilization above $40000, alongside a broader uptick in altcoin markets, sparking a new relief rally.
Over the past three days, the Ethereum price has seen a nearly 4% increase, now trading around the $2280 mark. Given this renewed buying pressure, can Ethereum leverage this momentum to surpass the $2500 threshold once again?
Bear Trap Reboots Recovery Sentiment in ETH
The Ethereum Fear and Greed Index at 48% reflects a neutral sentiment among traders.
The $2200 support backed by several technical levels creates a stoned support region.
The intraday trading volume in Ether is $6.3 Billion, indicating a 10.3% gain.
Ethereum Price| TradingView Chart
Over the recent fortnight, the Ethereum price experienced a pronounced correction, with its value plunging from $2714 to a low of $2168, marking a significant 20% decrease. During this pullback, the coin price broke below the channel pattern’s support trendline, which underpinned a recovery rally for nearly three months.
However, as the broader market’s bearish momentum began to fade, the ETH price demonstrated resilience around the $2200 mark, successfully reclaiming the previously breached support trendline. This reversal marked the prior downfall as a ‘Bear Trap,’ and triggered additional buying orders in the market, evidenced by considerable short liquidation.
Currently trading at $2280, if Ethereum can maintain its position above this reclaimed support, it could initiate a 6.85% relief rally, aiming for the $2430 level. This immediate resistance aligns with the 50% Fibonacci retracement level of the recent correction, highlighting a pivotal barrier that sellers are likely to defend vigorously.
Therefore, for Ether to continue its upward trajectory and potentially retest the $2700 mark, a breakout above this critical resistance level is essential to gain further momentum.
Has Ethereum Price Entered Downtrend Momentum?
Examining Ethereum’s daily time frame chart, it’s evident that corrections are a regular occurrence. In November 2023, the cryptocurrency underwent a 38.2% correction, followed by a 23.6% retracement in December 2023. Such trends suggest that these retracements, particularly around the 38.2% Fibonacci level, are typical for Ether, often serving as a precursor to subsequent upward movements.
Exponential Moving Average (EMA): Amid the recent downturn, the 100-day EMA slope at $2200 showcased its sustainability as valid pullback support.
Relative Strength Index (RSI): The daily RSI slope below 45% reflects the market sentiment currently bearish.
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