ETH Seems Primed to Take Down $4K After Recent Rebound: Ethereum Price Analysis
Ethereum has been oscillating within the critical $3.5K$4K range, with its price recently finding support near the lower boundary at $3.5K.
Following this rebound, the bulls are attempting a renewed push toward the $4K resistance level.
Technical Analysis
By Shayan
The Daily Chart
The upward momentum in Ethereums price met a pause at the $4K resistance, which has proven to be a key selling zone. This rejection led to a decline toward the lower boundary of the range at $3.5K. However, renewed buying activity at this support has triggered another strong push upward, targeting the $4K threshold.
The $4K resistance is pivotal, as it aligns with Ethereums prior swing highs and has repeatedly snubbed bullish attempts. Consequently, the short-term outlook suggests continued consolidation within the $3.5K$4K range. A decisive breakout above the $4K level could pave the way for a broader bullish rally.
The 4-Hour Chart
In the 4-hour timeframe, ETH faced a sharp rejection at the $4K resistance, resulting in an impulsive decline below the middle boundary of the ascending channel at $3.8K. This move reflects the strong presence of sellers at the $4K level, making it a formidable barrier for buyers.
Despite this setback, Ethereum found support near the $3.5K level, where buying pressure intensified. The subsequent bullish momentum pushed the price back above the channels middle boundary, bringing it close to the $4K resistance once again.
While buyers remain eager to breach the $4K threshold, bearish divergence on the RSI indicator signals caution. A short-term consolidation below this resistance appears likely before another potential bullish breakout.
Onchain Analysis
By Shayan
Ethereums price behavior, particularly its stability at the $3.5K support level, reflects the significant liquidity concentrated below this threshold, as highlighted by the Binance liquidation heatmap. Similarly, the $4K resistance level marks another critical zone of liquidity, primarily associated with short positions placed in anticipation of a price rejection.
These two levels represent the highest concentration of liquidity near the current price. If ETH successfully breaches the $4K resistance, it could trigger a short-liquidation cascade as short-sellers rush to cover their positions. This would likely result in an impulsive price surge as the unwinding of these positions fuels further upward momentum.
However, a breakout in either direction has the potential to ignite a liquidation cascade, intensifying the subsequent price movement. Given the prevailing market dynamics, a bullish breakout above $4K appears to be the more probable scenario.
The post ETH Seems Primed to Take Down $4K After Recent Rebound: Ethereum Price Analysis appeared first on CryptoPotato.
Text source: CryptoPotato
