The cryptocurrency market has been experiencing increased volatility as it approaches the end of the monthly trade. The recent surge in volatility has favored the bears, with Bitcoin slipping below $96,000. However, Ethereum has demonstrated strength by remaining stable and sustaining above $2,700. This unconventional price action against Bitcoin has led to a bullish sentiment in the market, with the potential to reclaim local highs at $3,000.
Despite the rising bullish sentiments, there is a possibility of the current upswing turning into a short-term rise that could trap the bulls. A recent exploit at a crypto-focused neobank, Infini, resulted in the loss of over $49.5 million. The stolen funds were used to purchase ETH, increasing buying pressure on the token. This led to an increase in ETH price, surpassing $2,840 and triggering notable selling pressure. However, the price is struggling to sustain above $2,700 as upward pressure intensifies, possibly due to millions of ETH being sold by the popular exchange, Binance.
While the reasons for the dump are unclear, some speculate it to be a Monday-Tuesday shakeout or a market-making strategy. The future of the ETH price rally remains uncertain—will it experience a short squeeze or a continued descending trend?
Ethereum price analysis reveals that the token is defending an ascending support that has been strong for the past five months. Over the weekend, the price surged above the support zone and almost cleared the resistance at $2,772. However, the lack of bullish momentum caused a drop below $2,700, raising concerns for Ethereum. The mounting buying pressure is fading, as indicated by a massive bearish candle on the chart. The CMF signal a market weakness, while the +Di & -Di of DMI show a deviation from a bullish crossover.
As the ETH price approaches the ascending trend line near $2,650, a failure to defend could lead to a drop to the lower support zone between $2,567 and $2,541. However, the strong ascending support may trigger a rebound towards the broken resistance at $2,772, avoiding a test of the lower support zone.
In conclusion, while the cryptocurrency market experiences increased volatility, Ethereum’s price action remains a key focus. The ongoing bullish sentiment and potential market strategies could shape the future of ETH price movement.