Key Points
- Bitcoin and Ethereum experience a dip in prices due to increased market sell-off.
- Ethereum’s future performance is uncertain, with potential for either a bullish reversal or further decline.
The cryptocurrency market has been experiencing a downward trend since the start of the week. The rise in selling pressure has surpassed the activity of buyers.
Bitcoin (BTC), the market leader, has lost approximately 3% in the past 24 hours, indicating a possible bearish trend. Similarly, Ethereum (ETH), the top altcoin, currently trading at $3,188, has reflected this sentiment with a 3.80% price correction and a trading volume of $18.9 billion in the last 24 hours.
Predicting Ethereum’s Future
The current market situation raises an important question: Will Ethereum’s price defy the odds and stage a bullish reversal, or will it succumb to selling pressure and retest its critical support level of $2,800?
Ethereum’s 1-day chart demonstrates the formation of a multi-pattern, indicating a period of uncertainty. Notably, the altcoin has been caught within a descending channel pattern since mid-May, indicating a long-term bearish outlook.
However, the market volatility in July provided a brief respite for ETH. The token formed an ascending channel pattern after successfully retesting its crucial $2,800 support level. This price action, however, was short-lived. With the recent market correction, Ethereum has deviated from this pattern, signaling a potential decline.
Adding to the bearish narrative is the Simple Moving Average (SMA) consistently acting as persistent resistance on the 1-day chart. This technical indicator suggests a growing dominance of sellers within the cryptocurrency space.
The Relative Strength Index (RSI) adds to this, failing to breach its neutral zone and persistently demonstrating a bearish downward trend. These technical indicators collectively paint a concerning picture of Ethereum’s short-term prospects.
Ethereum’s Support and Resistance Levels
If the market can regain some momentum, Ethereum could attempt to retest its resistance level of $3,300. A surge in bullish sentiment across the crypto market could see ETH break from its descending channel pattern and target its upper resistance level of $3,700.
However, if the bears maintain their hold on the market, Ethereum could see a significant decline towards its crucial support level of $2,800 sometime this month. A breakdown below this level could trigger further panic selling and increase the downward pressure on Ethereum’s price.
The coming days will be crucial for Ethereum. Whether the Ether will maintain its position at $2,800 or stage a bullish reversal will depend on broader market forces and investor sentiment.
