Ethereum has been in mild recovery this week after its recent free slide below the $3,000 level. As the entire cryptocurrency market continues to grapple under the pressure of a bear market, ETH is currently 32.05% lower than its all-time high of $4,885. In the prior week, ETH/USD was dragged down by hawkish FOMC minutes, breaking through the $3,400 zone. Despite its decline, Ether’s dip buying is growing more appealing, but the jittery market is making it increasingly difficult to find the “perfect” timing – particularly for short-term trading. Ether rebounded from its recent lows of $2,928 on Jan. 10 as bulls regain traction. At the time of analysis, ETH/USD continues to range below the $3,500 psychological zone, posting a daily high at $3,324. Since late October 2021, Ethereum’s network growth has been on a downward trend, as per Santiment. Other Layer 1 and 2 tokens have taken a chunk out of Ethereum’s market share over the last year as more people invest in tokens like Solana and Avalanche.
Key Levels
Resistance Levels: $4,000, $3,700, $3,500
Support Levels: $3,000, $2,700, $2,500
ETH/USD Daily ChartEther began a steady rise from the $3,000 support level. The ETH/USD pair is pushing for a return into the positive zone after breaking through the $3,200 zone. A move over the $3,400 level and the daily moving average (MA 200) would usher in the bulls. The pair is now consolidating gains over $3,200.
On the downside, $3,000 serves as an initial support level. On the daily chart, there is also a crucial bullish zone around $3,500, below which the pair could continue to lose ground. The pair might test the $2,700 if it breaks through critical support near $2,900. Overall the outlook for the pair is neutral after its recent rebound and might trade sideways.
ETH/USD 4-Hour ChartThe ETH/USD pair has been steadily rising since recent lows, with positive momentum continuing to build. Furthermore, the pair’s continuous higher lows, as well as the recent bounce off the 4-hour moving average (MA 50) support a short-term consolidation outlook.
A positive bias is also supported by short-term momentum indicators. The RSI is above its 50 neutral thresholds, while the short-term moving averages widens indicating that momentum is still gaining traction. This could mean that the optimistic bias is regaining more strength.
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