Ethereum Price Prediction: Odds stacked against bears’ comeback, but can ETH bulls retest $2,000?

Ethereum price has shown an exponential increase over the last three weeks. While a few bearish signs popped up along the way of lower timeframes, bulls continued to triumph. Now, another “sell sign” has been painted on the twelve-hour chart, which forecasts a trend exhaustion move is underway.

Ethereum price and its current state of things 

Ethereum price has rallied 37% since 2023 began and is currently hovering around $1,650. This massive ascent has set up two higher highs on January 13 and 20. But the Relative Strength Index (RSI) has formed a lower low above the overbought zone.

This non-conformity is termed a bearish divergence and indicates that the momentum is waning, which could trigger a trend reversal favoring the bears.

While the obvious theoretical outlook would be for Ethereum price to retrace, due to the formation of the equal high at $1,650, there might be a liquidity run, which could produce a third higher high. 

In this situation, bulls have a chance to come back by pushing the momentum indicator to produce a higher high as well. If buyers fail to make this happen, investors should start preparing for a trend reversal. The high timeframe support at $1,568 is the level that bears have to overcome in order to build up momentum against buyers.

If $1,568 is flipped into a resistance level, it will open the path for sellers to drive Ethereum price to $1,417, $1,331 and $1,227 support floors.

ETH/USDT 12-hour chart

What should bulls rectify?

As explained above, the chances that Ethereum price goes for another leg-up and set up a potential local top at $1,850. In its journey to collect liquidity resting above $1,650, ETH bulls need to make a comeback that pushes the RSI to produce another higher high in the overbought region.

If successful, Ethereum price could flip the $1,820 hurdle into a support floor. This move will invalidate the bearish thesis provided the RSI supports its ascent. Such a development could also open the path for ETH to retest the $2,000 psychological level.