Ethereum is currently at a critical juncture in its trading journey, facing significant selling pressure that has led to a more than 12% drop in price since last Tuesday. With the price hovering around $2,400, the cryptocurrency is struggling to maintain its bullish momentum. Analysts are warning that a deeper correction could be on the horizon if bulls fail to defend this crucial support zone. The recent decline in price reflects a broader market uncertainty, with increasing volatility shaking investor confidence at a time when Ethereum was poised to join a broader altcoin breakout.
Despite the current weakness, there is a sense of optimism among some market participants. Renowned analyst Ted Pillows recently shared a technical analysis indicating that Ethereum’s 12-hour chart has confirmed a Golden Cross. This bullish signal occurs when the 50-period moving average crosses above the 200-period moving average, typically signaling the start of a significant uptrend. If bulls can hold the current levels and reclaim higher resistance around $2,600, this Golden Cross could mark a turning point for Ethereum. However, the next few days will be crucial in determining whether Ethereum can bounce back or enter a prolonged consolidation phase.
The recent volatility in Ethereum’s price, with a rapid surge to $2,550 followed by a sharp reversal back to the $2,400 zone, has added to the uncertainty in the market. While Ethereum remains one of the stronger performers among altcoins, it is still down 36% from its December high of around $4,100. Bulls are now faced with the challenge of defending the $2,400 support level and regaining control by pushing the price above $2,800 to spark a sustained rally.
The $2,400 support level is now a crucial zone for Ethereum. A break below this level could trigger a deeper retracement, potentially leading Ethereum into a consolidation phase or lower support levels. Despite these challenges, technical indicators offer a ray of hope. The recent confirmation of a Golden Cross on the 12-hour chart suggests a bullish outlook for Ethereum, with some analysts predicting a potential move towards $3,000 in the near term.
However, for this bullish scenario to materialize, buyers need to step in with conviction. The current market sentiment remains fragile following last week’s price breakdown, and volume has been declining. If bulls can defend the $2,400 region and quickly reclaim higher resistance levels, the Golden Cross could signal the start of Ethereum’s next upward trend. Until then, the market remains in a state of anticipation, watching to see if the bullish signal can outweigh the pressure from sellers.
In conclusion, Ethereum is currently testing crucial support levels after experiencing a sharp drop from local highs. The cryptocurrency’s price consolidation above the $2,390–$2,400 zone is pivotal for bulls to maintain control. The 200-period EMA and SMA on the 4-hour chart provide long-term trend support, but a break below $2,390 could lead to a deeper retracement towards the $2,200–$2,300 range. On the upside, reclaiming $2,550 is essential for reestablishing momentum. Until then, the $2,400 level will continue to be a battleground for buyers and sellers amidst heightened volatility in the market.