Ethereum (ETH) retreated as the overall crypto market tumbled under bearish pressure after it was hit with liquidations. Ether’s February rally was invalidated when the price fell below the daily moving average (MA 50) level at $2,850 as of Mar. 3, forcing buyers to exit. ETH fell below $2,700 on Friday, dragged by further fall in altcoin markets on increased risk aversion. The total market capitalization has shrunk by $70 billion over the last day, slipping below $1.76 trillion as seen on CoinMarketCap. Liquidations of trading positions related to Ether (ETH) as per Coinglass data, the Ethereum blockchain’s native coin totaled $35 million at the time of this post. However, Ether bulls recorded a slight bounce at the intraday low level of $2,589 but trend followers could be looking to sell into strength. Ahead of its recent low is the closest resistance at $2,700 which might be breached temporarily due to profit-taking lifting the pair. Ethereum might be closing in a bear market territory at the end of the week as investors grow fearful of recessionary risks following the recent geopolitical tension. The correlation between cryptocurrencies and equities remains high.
Key Levels
Resistance Levels: $3,200, $3,000, $2,800
Support Levels: $2,500, $2,300, $2,000
ETH/USD Daily ChartETH/USD recorded consistent third straight negative sessions apart from today, plummeting to a weekly low at $2,589 on Friday. Technically the daily moving average (MA 50) is still strengthening its negative movement as price trades below, while the relative strength index (RSI) dived beneath its midline 50 reading, indicating that the negative movement might proceed to the oversold region.
The pair’s plunge below the support zone around $2,800-$2,700 has put the bears back on track. If the bulls recover the $2,700 level the bearish bias might come to an end in the next few sessions. A failure to overcome the $2,700 support turned resistance could send the price down to $2,500 and below, a challenging region over the last two months.
ETH/USD 4-Hour ChartOn the lower time frame, it’s another ball game as the general direction remains up despite its choppiness. The $2,300-$2,500 zones have proved to be solid support and kept the bulls in the game. ETH/USD has been trading sideways in the short-term, unable to close below the key support at $2,500 since its plunge of Feb. 24.
The 4-hour relative strength index (RSI), though, is currently encouraging that the sell-off may have found a bottom and the pair may be pushing for some recovery. Traders might have to play a waiting game to see a rally above moving average (MA 50) at $2,800 to eliminate fears of a down-trending market. At the moment outlook is in a consolidation.
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