- Ethereum faces strong resistance and bearish pressure, hindering potential price breakouts.
- Analyst Daan Crypto Trades highlights a full retrace and a $1.5B drop in open interest.
- ETH’s volatility declines, with a 20.16% YTD loss and uncertainty over short-term recovery.
Ethereum (ETH) is under pressure in the crypto market, trading near $2,695 as of press time and several attempts to cross the resistance level have been futile, which points to a bearish pressure ahead. Consequently, the market trends have turned bearish, and it is expected to decline significantly as long as no changes occur during the subsequent weeks.
Full Retrace Signals Weakness
In an X post on Tuesday, analyst Daan Crypto Trades highlighted that ETH is experiencing a full retrace. He stated that with the improvement in prices, open interest has declined, losing almost $1.5 billion, which had been gained in the previous price uptrend. This indicates that the market is weakening and will likely continue if insufficient buying demand is not forthcoming.
The absence of demand contributes to the continuation of the bear market. Daan stated even a slightly upward price movement had not pushed bulls to open longs. A lack of more bids placed in cryptocurrency means the ETH will likely experience more retracement. The market remains volatile, contributing to general risk aversion among traders.
This is after a loss in cryptocurrency prices’ volatility, with a dip to 2.04% in the last one-day period. In the past week, the price of ETH declined by 0.11%. The altcoin has been on a downtrend over the past month, having fallen 15.49% in value and is down 20.16% considering the year to date. This bearish attitude has caused investors to dislike it since it depicts Ethereum’s bleak and short-sighted outlook.
Bullish Breakout vs Bearish Continuation
According to technical analysis, there remains hope for a reversal of the trend in the short term. From the daily chart, the MACD histogram has formed a new green bar with a high volume, which may signal an uptrend. However, the 50- and 200-day Exponential Moving Average signals a so-called “Death Cross,” which implies higher market risk and overall uncertainty.
Source: TradingView
Ethereum could retest the $2,870 level in case of a bullish breakout and proceed to $3,272. On the same note, if the bearish pressure pushes through, the price of ETH may reach $2,530 or even $2,175, a level that traders should monitor in a couple of weeks.
The technical realignment of Ethereum has held a bearish sentiment and a breach below these levels might result in more downtrends, whereas a bullish tone would require buying interest. The traders will have to continue observing the market trends and look at the upcoming technical indicators to predict Ethereum’s movements.
