3 months ago
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If the market gains momentum, Ethereum might test its $3,300 resistance. A bullish shift could push ETH out of its descending channel and aim for $3,700.
The crypto market has been on a downward trend since the beginning of the week, with a rise in selling pressure that outweighs the buyers’ activity. Bitcoin (BTC), the market leader, has shed roughly 3% over the past 24 hours, indicating a potential bearish trend. Ethereum (ETH), the leading altcoin, currently trading at $3,188, has mirrored this sentiment with a 3.80% price correction and a trading volume of $18.9 billion in the last 24 hours.
In the current market situation, a crucial question emerges: will Ethereum price defy the odds and stage a bullish reversal, or will it fall to selling pressure and retest its critical support level of $2,800?
Technical Indicators Spell Ethereum’s Trouble
Ethereum’s 1-day chart reveals the formation of a multi-pattern, indicating a period of indecision. Notably, the altcoin has been trapped within a descending channel pattern since mid-May, highlighting a long-term bearish outlook.
Photo: TradingView
However, July’s heightened market volatility saw a brief reprieve for ETH, with the token forming an ascending channel pattern after successfully retesting its crucial $2,800 support level. This price action, however, proved to be short-lived. With the recent market correction, Ethereum has broken down from this pattern, signaling a potential decline.
Further adding to the bearish narrative, is the Simple Moving Average (SMA) consistently acting as persistent resistance on the 1-day chart. This technical indicator clearly suggests a growing dominance of sellers within the cryptocurrency space.
The Relative Strength Index (RSI) significantly adds fuel to the fire, failing to breach its neutral zone and persistently exhibiting a bearish downward trend. Such a confluence of technical indicators vividly paints a concerning picture of Ethereum’s short-term prospects.
Ethereum Faces $2,800 Support and $3,300 Resistance
If the market can regain some semblance of momentum, Ethereum could attempt to retest its resistance level of $3,300. Furthermore, a surge in bullish sentiment across the crypto market could see ETH break free from its descending channel pattern and target its upper resistance level of $3,700.
However, if the bears maintain their grip on the market, Ethereum could see a significant decline toward its crucial support level of $2,800 sometime this month. A breakdown below this level could trigger further panic selling and exacerbate the downward pressure on Ethereum’s price.
The coming days will be crucial for Ethereum. The Ether’s ability to hold its ground at $2,800 or stage a bullish reversal will depend on broader market forces and investor sentiment.
