The price has now reached a key support area defined by the 100-day moving average and the 0.5-0.618 Fibonacci levels after a period of correction. Considering the current strong demand, a medium-term bull market rebound seems likely.
Technical Analysis
Author: Shayan
Daily Chart
A detailed examination of the daily chart shows that Ethereum has entered a significant support area after a pullback. This area spans the price range between the 0.5 ($3421) and 0.618 ($3289) Fibonacci levels, coinciding with the key support point of the 100-day moving average ($3387).
This area has potential demand, and market participants may be inclined to open long positions. With these factors in mind, an increase in demand is expected, leading to a medium-term bullish reversal with a target resistance level of $4000. However, if the price falls below this support, the next important line of defense for buyers will be the 200-day moving average.
Source: TradingView
4-Hour Chart
The 4-hour chart clearly shows Ethereum’s recent corrective action, with the price forming a bullish continuation flag pattern. If the price breaks above the upper limit of this pattern, it signals the potential continuation of the bullish trend.
Currently, the cryptocurrency is close to the lower limit of this pattern, consistent with a key support of around $3300. If buyers re-enter the market and demand increases, the price is expected to break the upper limit of the flag and reach $3600, leading to a strong rise towards the resistance level of $4000.
On the other hand, if sellers push the price below the support level of $3300, it may then fall to a significant support level of $2900. In the medium term, the price is expected to remain in the range of $3300 to $3600 until a breakthrough occurs.
Source: TradingView
Sentiment Analysis
Author: Shayan
While Ethereum is currently in a key support area with significant potential demand, analyzing future market sentiment is crucial for predicting its next move.
The chart below highlights Ethereum’s funding rate indicator, which indicates whether buyers or sellers are executing orders more aggressively. A positive funding rate implies optimism, while a negative rate indicates pessimism.
After a period of slight decline, the funding rate indicator has recently shown a significant increase, coinciding with Ethereum’s price adjustment phase. This increase indicates that demand is close to the key support level of $3300, which may prevent further downward pressure and trigger a bullish reversal.
If the funding rate indicator continues to trend upwards, it suggests that the sentiment in the futures market is shifting towards a bull market, increasing the likelihood of a medium-term bullish reversal.
Source: CryptoQuant