Ethereum Faces Mounting Downside Risk as Recovery Efforts Stall
Ethereum (ETH) is grappling with significant market pressure, as a recent recovery attempt above the $4,350 mark has failed to gain traction. The cryptocurrency remains highly vulnerable, with analysts warning of substantial downside risk should it fail to hold critical support levels, potentially sliding below the $4,270 zone.
ETH Struggles Amidst Key Resistance Levels
After an initial rebound from a base established around $4,220, Ethereum briefly moved past $4,300 and $4,320, but the upward momentum was short-lived. A high was recorded at $4,383 before bears reasserted control, initiating a fresh decline. This led to a drop below the $4,320 support, breaching the 50% Fibonacci retracement level of the recent swing. Furthermore, a crucial bullish trend line at $4,290 on the hourly ETH/USD chart was broken. ETH is currently trading beneath $4,320 and the 100-hourly Simple Moving Average. For any bullish reversal, Ethereum needs to decisively clear resistance levels at $4,320 and $4,360, with a breakthrough above $4,400 potentially opening the path towards $4,440, and even $4,500-$4,550.
Looming Threats of Further Decline
The outlook remains challenging; if Ethereum cannot break past the $4,360 resistance, it is highly likely to face further downward pressure. Immediate support levels are identified around $4,270, with the primary major support situated at $4,220. A sustained move below this $4,220 mark could trigger a cascade of losses, pushing the price towards $4,200, then $4,160, and potentially as low as $4,120 in the near term. Investors should brace for intensified bearish activity if these critical supports falter.
Technical Indicators: A Bearish Signal
- Hourly MACD: The Moving Average Convergence Divergence for ETH/USD is showing increasing momentum in the bearish territory.
- Hourly RSI: The Relative Strength Index for ETH/USD is currently below the 50 zone, reinforcing the prevailing bearish sentiment.
- Major Support Level: $4,220
- Major Resistance Level: $4,360
