Ethereum’s price has been struggling to break above the $2,000 mark in the last week, facing significant downward pressure that has kept it below this key level. This trend of bearish dominance has been prevalent in the wider crypto market since early March, with sellers maintaining control.
Recent technical analysis utilizing Elliott Wave theory suggests that Ethereum is likely to continue facing downward pressure in the near future. A crypto analyst on TradingView known as behdark has identified an ABC correction pattern forming in Ethereum’s price structure. This correction pattern has been unfolding since November 2021 and spans over three and a half years.
The ABC correction pattern consists of three waves – A, B, and C. Wave A represents the initial decline, wave B is a temporary retracement, and wave C is the final downward leg. The completion of wave B suggests that Ethereum is now poised for a prolonged decline, with wave C expected to extend beyond wave A.
The analyst has identified two potential demand zones for Ethereum, labeled as “Demand 1” and “Demand 2.” The first demand zone, between $1,350 and $1,080, may provide some buying pressure to halt the continuation of wave C. However, if this zone fails to hold, Ethereum could experience a deeper correction towards the second demand zone, between $760 and $530.
In the event that Ethereum reaches the second demand zone, it could present a buying opportunity for bullish traders as it marks the beginning of the next five impulse waves. The analyst has set an invalidation level at $2,941, stating that a daily candle close above this level would nullify the bearish scenario.
As of the time of writing, Ethereum is trading at $1,930, with the likelihood of breaking above $2,941 in the short term appearing slim based on the current price structure. Traders will be closely monitoring Ethereum’s price movements in the coming days to see if it can break out of its current bearish trend.
Overall, Ethereum’s price outlook remains bearish in the short to mid-term, with the potential for further downside before a potential reversal. Traders and investors should exercise caution and closely follow technical analysis to make informed decisions in this volatile market.