Ethereum, the second-largest cryptocurrency by market cap, has entered a phase of downside correction, dipping below the crucial $3,150 zone. The price of ETH is now consolidating near $3,120, with market watchers eyeing a potential fresh increase.
In recent trading sessions, Ethereum failed to sustain its momentum above the $3,250 level, initiating a downward trend similar to Bitcoin’s recent performance. This correction saw ETH drop below significant support zones at $3,150 and $3,120, with bears ultimately pushing the price below the $3,040 mark. The cryptocurrency found some respite at around the $3,000 support zone, recording a low at $3,016.
From this low, Ethereum has started to consolidate its losses, climbing back above the 23.6% Fibonacci retracement level of its downward move from the $3,340 high to the $3,016 low. However, ETH is still trading below $3,200 and its 100-hourly Simple Moving Average, indicating persistent bearish pressure.
On the upside, the first obstacle for Ethereum is the $3,120 level, which coincides with a short-term contracting triangle’s resistance on the hourly chart of ETH/USD. If Ethereum can clear this hurdle, it might aim for the next significant resistance at the $3,180 level. This price point is also close to the 50% Fibonacci retracement level of the recent downtrend.
The primary resistance, however, is forming near the $3,220 mark. A decisive break above this level could pave the way for Ethereum to target the $3,320 resistance, and possibly higher gains toward $3,450, if momentum sustains.
Conversely, if Ethereum fails to surpass the $3,320 resistance, it risks triggering another downtrend. Initial support on the downside is eyed around the $3,060 level, with the first substantial support appearing near $3,040. A break below this may push ETH towards the $2,980 level, and any further losses could drive the price down to the $2,920 support or even lower to $2,880.
Technical indicators suggest caution: the hourly MACD for ETH/USD is losing steam in the bearish zone, while the hourly RSI for ETH/USD has dipped below the 50 mark. These signals point to potential continued volatility, with major support and resistance levels remaining at $3,040 and $3,120, respectively.
