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Cryptocurrencies: Ethereum’s Momentum Continues to Fade! Analysis as of June 26, 2024
After peaking, Ethereum is experiencing increasingly threatening selling pressure. Let’s examine the future prospects of ETH together.
Current state of Ethereum (ETH)
After peaking at $3,950 later approval of spot ETFs on Ethereum, the price of Ethereum faced selling pressure which naturally pushed the price of the cryptocurrency lower. This decline was fueled by the decline in Bitcoin, which dragged the entire cryptocurrency market with it. Therefore, Ethereum is in a short-term downtrend. However, it seems to have attracted the interest of buyers at $3,250, which allowed it to remain above $3,300, the price level highlighted in the Analysis of June 12th. This leaves hope for a potential rebound to counteract this selling pressure.
Ethereum is now just below its 50-day moving average. This is not reassuring for the medium/long-term structure of the cryptocurrency. However, we can be reassured by the fact that it remains above its 200-day moving average. For what concern Ethereum price dynamics, it is not surprising that it continues to fall, as evidenced by the oscillators and the price of Ethereum itself. While this may be a timely signal in an uptrend, it can become concerning as this decline intensifies.
The current technical analysis was conducted in collaboration with Elie FT, a passionate investor and trader in the cryptocurrency market. Today he is an instructor at Family businessa community of thousands of proprietary traders active since 2017. You will find lives, educational content and financial markets support in a professional and friendly environment.
A Closer Look at Derivatives (ETH/USDT)
Open interest in Ethereum perpetual contracts appears to have followed the cryptocurrency price trajectory. This demonstrates an exit from positions by speculators as the price of ETH declines. This phenomenon can be explained by a capitulation of buyers, subtly illustrated by the latest predominantly purchase liquidations. This, combined with continued declines in funding rates, demonstrates growing selling pressure on ETH/USDT contracts. Of course this is not convincing from the buyer’s point of view.
The ETH/USDT liquidation heatmap over three months reveals that the contact of the last two liquidation zones with the Ethereum price has not triggered sustained buying interest. Currently, the most significant liquidation zones in recent months are above the current ETH price. In particular, the area just below $3,700 and the one still visible around $3,900. Below the current price, the significant zone is just below $3,100, extending up to $2,800, where it appears more pronounced. A price approaching these levels could trigger massive order executions, increasing the risk of increased volatility for Ethereum. These areas therefore represent critical points of interest for investors.
Ethereum (ETH) price hypothesis.
- If the price of Ethereum were to remain above $3,250, we could anticipate a bullish recovery up to $3,500, or even $3,800. The next resistance to consider would therefore be between $4,000 and $4,100. If the upward movement continues, this could mark a new peak at $4,500, paving the way for Ethereum to reach an all-time high. At this point that would represent an increase of more than 32%.
- If the price of Ethereum fails to stay above $3,250, we could expect a return around $3,000. The next support to consider, if the bearish movement continues, would be in a price range between $2,900 and $2,800. Further down, we can see support at $2,700. At this stage it would represent a drop of around 20%.
Conclusion
Ethereum is currently experiencing a decline influenced by the collapse of the cryptocurrency market. Despite this selling pressure, key support has maintained a certain price level, raising hopes for a potential rebound. However, the situation remains uncertain, with ETH’s bearish momentum continuing, which could become worrying if this trend continues. Therefore, it will be crucial to closely observe the price reaction at several key levels to confirm or invalidate current assumptions. It is also important to remain vigilant against potential “false exits” and market “squeezes” in every scenario. Finally, remember that these analyzes are based exclusively on technical criteria and that cryptocurrency prices can also evolve rapidly based on other more fundamental factors.
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