Ethereum Price Update: ETH Encounters Significant Resistance at $2.8K, Bearish Sentiment Looms

Ethereum has recently seen a support level at $2.1K after a notable cascade, followed by a modest bullish recovery. However, the current movement suggests a retracement towards the broken lower boundary of the wedge, signaling a potential completion of a pullback. This development hints at a potential bearish trend continuation in the near future.

Analyzing the technical aspects, a detailed examination of Ethereum’s daily chart shows that the cryptocurrency broke below the wedge’s lower boundary at $2.8K amid significant market turmoil, leading to a cascade. Despite this, the price found support at the critical $2.1K level, triggering a bullish reversal. Subsequently, there was an emergence of buying pressure, resulting in slight bullish retracements towards a notable resistance level.

This resistance level corresponds to the previously breached lower boundary of the wedge, where existing supply could impede further upward movement and potentially reject the price in the days ahead. Failure to reclaim this crucial resistance may lead to a completed pullback, setting the stage for a potential bearish continuation targeting the substantial support level at $2.5K.

Transitioning to the 4-hour chart, Ethereum’s upward momentum is evident, characterized by higher highs and higher lows during a phase of upward retracements. However, the cryptocurrency is currently encountering a strong resistance zone between the $2.6K and $2.8K Fibonacci levels. This range serves as a primary target for the market’s corrective phase, with the potential to repel the price in the upcoming sessions.

Moreover, within the recent retracements, Ethereum has entered a bearish continuation triangle pattern, further accentuating the likelihood of a bearish trend continuation. If the price faces rejection and breaches below the triangle’s lower boundary, a bearish trend continuation towards $2.1K could become imminent. The forthcoming market action will be pivotal in determining Ethereum’s next trajectory, with current indicators favoring a bearish sentiment.

In terms of on-chain analysis, following the recent downturn, many investors have experienced substantial losses, particularly in the perpetual futures market. Therefore, monitoring the updated state of the futures market can provide valuable insights into the current market dynamics. The Ethereum Open Interest metric, which gauges the number of open futures positions, suggests a significant decline post the recent price drop, indicating a high number of liquidations. A potential increase in demand in the spot market could pave the way for a more sustainable uptrend.

Overall, the evolving market conditions and price movements underscore the importance of closely monitoring Ethereum’s performance in the coming days, with current signals pointing towards a bearish outlook.