Disclaimer: The following analysis is the sole opinion of the author and should not be viewed as investment advice
Crypto twitter is full of fun stuff and memes, especially when prices are falling. One thing that comes to mind is to apply for a job at McDonald’s if Ethereum had encountered a rejection in the $ 4000 range; such a rejection could actually have happened as ETH has already broken a significant resistance level from Bitcoin. but the momentum has stalled $ 4050. Will ETH go higher or will crypto traders become meme doc in the coming weeks?
ETH: 12-hour chart
Source: ETH / USDT on TradingView
The meaning of $ 3950 to $ 4050 is no joke. $ 4000 is actually a circular numeric resistor that is at an important transition point on the charts. The price was attractive at this level to test the strength of buyers and sellers. Here, too, ETH tested this pocket, but a bearish divergence was noted between price and momentum.
Just above this level, place the 23.6% retracement at $ 4,121, which is another key level for buyers to push back in the near future.
Incorrect break in trend line resistance to encourage buyers, rejection on major HTF resistance and strong downward movement – this event will cause late buyers ($ 3800-3900) to sell or lose break even. Additionally, the double pressure may push the price further south with the 50% retracement at $ 3,287.
Theoretical basis
Source: ETH / USDT on TradingView
Double pressure means the market is under pressure from sellers, and that pressure is compounded by enthusiastic, late buyers who are forced to buy back their long positions and sell at a loss / break-even point.
The CMF has a good gap above +0.05 which means there is still capital in the market, a bullish sign. However, the MACD is still below 0. This shows that the uptrend is not yet strong. The RSI also failed to break above the neutral 50 level and formed a bearish divergence.
Inference
Whether Ethereum can consolidate below the resistance before another attempt to climb higher or a double-push scenario unfolds remains to be seen. Stagnant price action and momentum suggest a possible bearish scenario.
ETH will then be forced to look for buyers in the USD 3800 range, if that fails it may drop to the USD 3300 range. In the next few days, however, if there was just a minor pullback, some consolidation, a surge above 4050 USD and a. To reverse this range, Ethereum will climb higher quickly.