Ethereum’s price analysis has been a topic of interest lately, especially as the cryptocurrency’s bullish momentum has shown signs of weakening. After breaking the middle trendline of a multi-month descending channel, Ethereum has been experiencing muted sideways price action.
Consolidation Phase and Potential Pullback
Despite the recent breakout, Ethereum’s price is currently consolidating in a sideways pattern, which could potentially lead to a pullback. This phase of consolidation might set the stage for the next leg of the bullish trend.
Technical Analysis by Shayan
According to Shayan’s analysis on the daily chart, Ethereum saw a surge in buying activity in both the perpetual and spot markets, breaking above the crucial $2.5K resistance level. This breakout signals a strong intent from buyers to push ETH towards its yearly high of $4K, despite the prevailing bearish sentiment in recent months.
Currently, Ethereum’s price is consolidating in a sideways pattern, hinting at a potential pullback towards the recently broken trendline. If the price retraces to the $2.5K level and finds strong support, it could position Ethereum for a renewed push towards the channel’s upper boundary, around the $3K mark.
On the 4-hour chart, Ethereum’s upward momentum stalled near the significant resistance zone around the 0.5 Fibonacci retracement level ($2.6K). This area has consistently acted as a barrier for buyers aiming for the $3K resistance level. While ETH may face a period of sideways consolidation or corrective retracements in the short term, a resurgence of bullish momentum could lead to a breakout above this resistance zone.
Onchain Analysis by Shayan
Shayan’s onchain analysis focuses on Ethereum’s 30-day moving average of funding rates, a key metric that provides insight into the sentiment of futures traders. The recent slight bullish shift in the 30-day moving average of ETH funding rates coincides with a broader market rebound and an uptick in ETH’s price, indicating a possible change in overall sentiment.
The rise in funding rates suggests increased buying activity among futures traders, signaling a more bullish outlook. For Ethereum to continue its recovery and target higher price levels, the demand in the perpetual futures market must keep rising in the coming weeks. A sustained uptrend in funding rates could drive further price surges in the mid-term.
In Conclusion
Overall, Ethereum’s price analysis suggests a potential pullback followed by a renewed push towards higher price levels. The recent bullish momentum, coupled with onchain analysis indicating increased buying activity in the futures market, paints a positive outlook for Ethereum’s price potential in the near future. Investors and traders will be closely watching how Ethereum navigates the current consolidation phase and whether it can maintain its upward trajectory.