Ethereum and the majority of cryptocurrencies fell further on Friday as major investors continue to adjust their position in reaction to price gains in commodities and emerging market equities which remain a clear sign of improved risk sentiment. In December 2021, Ethereum failed to break through and hold above the $4,000 price threshold, indicating a declining market. Ethereum’s share of the decentralized finance market has been steadily shrinking over the past year due to rapid growth from competitors such as Terra, Binance Smart Chain, Avalanche, and Solana. Earlier today, the price of Ether had fallen to a low of $3,065 after breaching the MA 200 in the prior day. Ether selloff might continue to intensify towards key support zone of $3,000 and $2,700. According to data from CoinGlass, Ethereum futures trades have seen longs of $170 million liquidations over the past 24 hours. At the time of analysis, ETH/USD is exchanging at $3,201.
Key Levels
Resistance Levels: $4,500, $4,000, $3,500
Support Levels: $3,000, $2,500, $2,000
ETH/USD Daily ChartAs for ETH/USD, the bears are confident that the path of the least resistance may be skewed towards the downside as Ethereum’s price has decided to stay below the $4000. As long as the price holds under this level, the chances of Ethereum price dropping below the $3000 mark are increasing and the chances of price touching the level of $2700 are considerable.
After briefly breaking out of oversold territory in the prior session, the Relative Strength Index (RSI) returned to oversold territory. The next support at $3,000 may keep some buying interest in play at the moment. If they fail to hold, all attention will shift towards the $2700-$2500 floor, where any violation is expected to activate a sharp decline further.
ETH/USD 4-Hour ChartOn the lower time frame, the ETH/USD continues to trend lower as sentiment remained downbeat after a break below the key support at $3,200. Anticipated rebounds have so far been checked by solid selling interest. The current bearish action under the 4-hour moving average (MA 50) could be another phase of selling.
Therefore, the bears may be pushing towards low at $3,000, the last major support before reaching September 2021 low at $2,650. Near the moving average (MA 50) at $3,650 would be the major resistance in case of a bullish attempt. Although rising negative trends decrease the case for a rebound, ETH/USD is preparing the stage for an upside corrective move.
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